Richard Nixon photo

Special Message to the Congress on Health Programs.

February 20, 1974

To the Congress of the United States:

Good health is basic to the well-being of any society, as basic as education, jobs and individual liberties. Improving the level of health in America and assuring that all Americans have financial access to quality health care remains a top priority of this Administration.

By world standards, the health of Americans is good, and our health care system is capable of delivering the finest and most modern care the world has ever known.

But there are still inequities and deficiencies. Improvements can and must be made.

The objectives we seek for health care in this country can be simply stated:

--We want all Americans to have the necessary financial resources to purchase the health care they need at reasonable prices.

--We want an adequate supply of health professionals--doctors, nurses and others--to serve our communities.

--We want a full range of health services to be used efficiently by those who need them; over-use is poor health care and bad economics.

--And we want a strong research program to find ways to prevent and cure diseases.

These are common objectives all reasonable people can agree on. But we must also reach a consensus on how best to achieve them.

Neither the private sector nor the Federal Government acting alone can assure financial access to care for all, improve the quality of services, and guarantee that biomedical research is both supported and utilized. We must rely instead upon a partnership among private physicians and institutions, State and local authorities, and the Federal Government--a partnership that builds upon the strengths of the present system and gives it new vitality.

We have already made great progress. By strengthening and expanding our partnership, we can .achieve even more. I have already proposed an integrated strategy that includes a Comprehensive Health Insurance Plan as well as rapid development of Professional Standard Review Organizations, continuation of price controls in the health sector, and increased biomedical research funding. I am recommending other health proposals on planning and health manpower. Taken together, these measures represent a realistic and effective health strategy for the 1970's--a strategy to improve the quality of health care for all of our citizens. In this message, I want to review the components of that strategy and outline the additional proposals that the Administration will soon be sending to the Congress.


Today the health insurance possessed by many Americans is often inadequate or encourages misuse of the health care system. Usually it pays for a stay in the hospital, but not for visits to the doctor's office. It will pay for only a limited number of days in the hospital. Often it fails to cover prescription and life-saving drugs, or preventive services for the young, or mental health care. Finally, while it often encourages unnecessary use of expensive services in the short run, it fails to protect our citizens against the massive financial loss from catastrophic illness in the long run.

The Comprehensive Health Insurance Plan that I recommended to the Congress two weeks ago would correct these and other deficiencies. Our plan would provide a very comprehensive package of health services. It includes preventive health services for children and pregnant mothers, dental care for children, and mental health care for all. It would provide for free choice of care, whether from traditional fee-for-service physicians or from pre-paid health maintenance organizations, and it would provide incentives to control costs. It would also eliminate duplicate billing and accounting procedures for both patients and providers. Most importantly, it would remove the threat of family bankruptcy due to the costs of catastrophic illness.

Placing health benefits within the financial reach of all Americans is the central element of our health strategy for the 1970's. But such benefits alone are not enough.


Under my Comprehensive Health Insurance proposal, the Professional Standards Review Organizations now being established by law would be expanded to improve the quality of health care for all.

As presently contemplated, there will be a nationwide system of locally run physician organizations which will review the quality and effectiveness of medical care delivered to Medicare, Medicaid, and Maternal and Child Health beneficiaries. These new organizations, called PSRO's, provide great potential for bringing about improvements in health care practices by the best possible utilization of health care facilities and services.

This program is a unique Federal effort. It recognizes that physicians at the local and State level are best suited to judge quality and appropriateness of care. Individual PSRO's will be established and operated by local physicians, although the Federal Government will pay the operating costs. A number of PSRO's are expected to be designated and set into operation by the end of this fiscal year.


Assurance of quality is not enough. We must also avoid the cost inflation which followed the introduction of Medicare and Medicaid. Our health insurance proposal would call for States to oversee the operation of insurance carriers and establish sound procedures for cost control. Until these or other controls are in place, I recommend that our present authorities to control health care costs be continued. I am asking the Congress for such authority.

Between 1969 and 1971, when consumer prices rose at an annual rate of 5.3 percent, medical care services measured by the Consumer Price Index rose 7.7 percent a year, with hospital costs rising by over 13 percent each year. In these years leading up to the beginning of the Economic Stabilization Program, the health industry was the most inflationary sector in the American economy. As such, it was a special economic problem requiring special regulations.

Two and one-half years of controls brought the annual rate of increase in medical prices down from 7.3 percent to 3.7 percent in 1972 and 4.4 percent in 1973. The 1973 rate was below the general rate of inflation. But inflationary pressures are still strong in the medical field, so that we must maintain Federal controls until other measures are adopted under Comprehensive Health Insurance.


Improved professional standards and sensible cost controls should be complemented by improvements in health services.

Presently, much of our health care is delivered in a hit-or-miss fashion. Too few American communities know how to balance their health services properly. There are too many hospital beds in many communities and not enough out-patient services; few communities are capable of delivering high-quality emergency medical care; and we do not have enough physicians and other health professionals delivering primary health care. These problems could grow more serious. Removal of financial barriers can be expected to create new demands on our health care delivery system.

We must develop a better capacity to forecast and anticipate health needs rather than having to react hurriedly after the fact. The delivery of health care must be planned and guided in the States and communities by those persons who best understand the health problems of the people and localities concerned.

There are many concrete steps to be taken. For example, we must maintain our efforts to demonstrate for local communities the benefits of comprehensive emergency medical care systems. We must also maintain our newly enlarged capacity to produce well trained health professionals, we should continue to provide incentives to train primary care physicians and we should demonstrate ways of bringing services of physicians into rural and inner city areas where doctor shortages exist. Further, we must improve our methods of quickly converting research findings into physicians' practice. The Nation should perfect a system where scarce lifesaving technology is available to serve all those who need its benefits.

To accomplish these goals, we must encourage State, local and private authorities to modify some of the existing organizations and laws relating to health regulation, licensing, planning, production and manpower allocation.

Existing planning agencies have faced these issues to the best of their abilities. Some have performed well, helping States and communities plan for new and improved health resources in a rational, orderly and economical way. Others, however, have failed to bring about material improvements in the health care system and are not well suited to the demands of the future.


We will shortly be submitting legislation to the Congress that would authorize the Department of Health, Education, and Welfare to support local health planning boards composed of representatives of the public, health care providers, insurers, health educators and elected officials. These boards would prepare comprehensive health plans for health care delivery systems designed to meet the needs of the people in their areas. States would continue to have the primary role of approving new facilities and would receive assistance in monitoring rate increases in the health industry.

The boards would assume the present planning activities of the Comprehensive Health Planning Program, the Regional Medical Programs Service, and the Hill-Burton program, all of which now overlap at the local level. They would coordinate the planning and activities of health care providers, third-party financing organizations, health educational institutions, and government within each area in order to promote high quality care for the public good. They would also advise on Federal health grants in the areas served to ensure consistency of such activities with regional plans.


Our most important health care resource is health manpower. It is this resource upon which all else depends. Assuring that there are enough health professionals of the right kind available in the right place to provide the needed care is one of our most challenging health delivery problems.

The number of U.S. medical and osteopathic schools has grown from 92 in 1963 to 121 in 1974. Total enrollment increased 60 percent from 33,072 to 53,100 and graduates increased over 40 percent, from 7,631 to 10,900. These increases in health manpower encourage us to believe that the Nation's total supply of health professionals is becoming sufficient to meet our needs during the next decade. In fact, over-supply in the aggregate could possibly become a problem.

Without major alterations in either present enrollments in domestic schools or immigration patterns of foreign-trained doctors, we estimate that the number of physicians by 1985 will approximate 500,000. This is an increase of at least 50 percent over 1970, and would be more than three times the expected growth rate of the U.S. population during the same period. Accordingly, the number of physicians per 100,000 population should increase from 159 in 1970 to as high as 217 in 1985.

Ironically, the increase in overall physician supply has not solved the problem of maldistribution. Some rural and inner city areas still lack a sufficient supply of general practitioners, and many areas lack certain medical specialists. We must now shift our attention away from a concern with aggregate numbers toward an emphasis on solving specific health manpower problems.


We will soon submit legislation to the Congress designed to maintain present enrollments but also to gradually shift the method of support for medical education from general institutional operating subsidies to direct assistance to medical students through individual loans and scholarships. Funds provided directly to institutions will be targeted on special projects such as the production of more primary care physicians.

We shall also continue our ongoing efforts to expand the training and the effective use of physician assistants. Some 3,300 of these new health professionals are now being trained as a result of Federal initiatives. They are demonstrating that they can enable physicians to practice more efficiently and thereby extend their skills to more patients. Their services would be reimbursable under our Comprehensive Health Insurance Plan.

Other measures that I have proposed would assure that qualified students would be able to receive training in health education institutions regardless of financial barriers. Under my proposed scholarship legislation, scholarships would be offered to any student who agrees to serve in programs or shortage areas of national need after graduation. I am also proposing to increase the upper limits on guaranteed loans. The loan guarantee program would provide larger annual loans to students with repayment deferred until after graduation. These would be particularly helpful to those seeking education in the health professions, but would .be available in all fields. Loans for education costs are a particularly appropriate financing mechanism for health professionals who can look forward to exceptionally favorable lifetime earnings.



One of our major initiatives to improve the access to care is the encouragement of Health Maintenance Organizations. In certain instances, HMO's have proved their ability to deliver quality health care to people when and where they need it at prepaid premium rates. It may be possible to use this mechanism to extend health care services into underserved areas where individual health practitioners are unavailable.

Since 1970 we have been seeking direct authority to demonstrate the HMO concept more broadly. This past December 29, I signed legislation into law which will stimulate the development of HMO's in many different settings.

I am requesting a total of $125 million for 1974 and 1975 to begin this important new program. We expect to fund 170 HMO's during the life of this legislation. Our Comprehensive Health Insurance Plan would require employers to also offer HMO care where available, a provision that we believe will further promote HMO development.

We will use Federal funds to support feasibility and planning studies, to pay initial development costs, and to subsidize initial operating deficits of HMO's for the first three years. In addition, loan guarantees will be offered to profit-making HMO's in medically underserved areas for planning, initial development and initial operating deficits.

The HMO law I signed represents an important response to the challenge of finding better ways to improve health care for the American people. It will build on the partnership that already exists between the Federal and the private sector by allowing both the provider and the consumer of health services to exercise the widest possible freedom of choice.


Access to health care is also affected by the degree to which our citizens exercise their individual responsibility to maintain health, prevent serious illness, and properly use the health services which are available to them. By accepting this responsibility and acting wisely, they can prolong their lives and prevent much needless disease and disability. They can also make full and efficient use of the health services available to them.

Yet despite major efforts and investment of resources by governmental and private agencies, it is evident that the necessary knowledge is not reaching enough of our people and that many people who have access to that knowledge do not act upon it.

During the past year I received the report of a distinguished group of professional and civic leaders whom I had asked to recommend an action program to improve health education in the United States.

On the basis of the recommendations of this group we will establish an office of health education within the Department of Health, Education, and Welfare. This new organization will bring together and coordinate the existing fragmented health education efforts now underway in many health programs and agencies. It will also evaluate the approaches we now use in attempting to encourage people to lead healthier lives and will develop more effective educational techniques.

At the same time we will work with the private sector to develop a National Center for Health Education. While the Federal Government will assist in launching the center, we intend that it eventually be supported by private funds.

Potentially, these actions could sharply improve the effectiveness of health education through many channels, including our schools, mass media, neighborhood and community organizations and the health care system itself.


We are moving to improve the quality of our health care and consumer services on a number of fronts. Professional Standards Review Organizations will allow physicians to monitor and improve the quality of their own services. Health Maintenance Organizations hold promise for delivering quality care efficiently to great numbers of people, even those in rural areas. Demonstrating improved emergency medical systems can significantly improve the quality of care rendered in situations where minutes mean life or death.

But there are some elements of personal health care and management which are beyond the control of the individual and often beyond the influence of the health care system. One such area is protection against unsafe food, drugs, cosmetics and medical devices.

This year I have asked the Congress to appropriate $200 million for the Food and Drug Administration, an increase of $35 million. These added funds would allow the FDA to intensify its inspection activities and increase its research.

Furthermore, I again urge the Congress to take swift action on the legislation I proposed last year to regulate the sale of medical devices. This new authority is essential if we are to assure that new technology for the diagnosis and treatment of disease is both safe and effective.

Legislation recently submitted to the Congress would upgrade the quality of foods and drugs available to the American public. These amendments would:

--Broaden inspection authority.

--Broaden FDA's authority to inspect quality control records in food, drug, device and cosmetic factories.

---Authorize FDA to require needed record-keeping and reporting for foods, certain drugs, medical devices, and cosmetics.

--Require the labels of nonprescription drugs to show the quantity of all active ingredients.

--Authorize FDA to detain products suspected of being unsafe or contaminated.

FDA has also initiated a broad program for licensing, registering and inspecting blood banks. This extensive program should significantly reduce the chances of blood recipients contracting hepatitis.


In 1971 I launched a major new initiative to improve the quality of care in our nursing homes. Since then we have worked with State governments to improve their nursing home inspection efforts, and we have barred substandard facilities from participating in our Medicare and Medicaid programs. Yet many long-term care facilities in this country still do not meet accepted fire and safety standards. This situation must be corrected, and we are taking steps to improve it.

Last month the Department of Health, Education, and Welfare issued new standards to improve the quality of medical services in nursing homes caring for Medicare and Medicaid patients. Very soon, the Department will issue additional regulations to improve the medical services in these homes. As a Nation we can no longer tolerate the warehousing of our older citizens in unsanitary and unsafe facilities. They have given us much. In return they deserve quality care in their declining years that is second to none. Our efforts to expand our biomedical knowledge about diseases will, of course, improve the care that can be rendered in nursing homes.


In addition to attacking problems of the delivery system as a means of improving our health care, we must also continue to support our basic scientific research. It is this work that will tomorrow yield the remedies to diseases that affect our people.

We will continue to give high priority to research in cancer and heart disease because these two diseases together account for more than half of all deaths each year. At the same time, however, we will not neglect research on aging, arthritis, neurological diseases, dental diseases, and other major health problems.


Cancer, in its more than 100 forms, still constitutes one of the most devastating health problems confronting mankind. This year, the National Cancer Institute estimates that 655,000 Americans will develop cancer, and 335,000 will lose their lives from it. Three years ago in my State of the Union message I announced that the conquest of cancer was to be a new national goal. In December of 1971 I signed the National Cancer Act. Since that time, the National Cancer Institute and other institutes in the National Institutes of Health have accelerated the drive against cancer.

The intensified effort has two goals: First, the main effort is to stimulate the development of new knowledge by an intensive and coordinated research effort throughout all medical, biological, chemical and physical sciences. Secondly, we are seeking the most effective methods of disseminating across the Nation vital information on the prevention and treatment of :cancer.

In 1971, appropriations for the National Cancer Institute were approximately $233 million. For fiscal year 1975, I have asked the Congress to appropriate $600 million.

We have made substantial progress in bringing the results of research as rapidly as possible to a maximum number of people. The latest advances in cancer therapy are being made widely available throughout the country for patients with leukemia, Hodgkin's disease and other lymphomas. We will assure that the newest and best cancer therapies will be available to the medical community. Major studies are underway at several institutions to detect lung cancer--the major cancer killer--at its earliest stages. In addition, the National Cancer Institute has pooled its resources with the American Cancer Society to open 20 demonstration centers for the early detection of breast cancer, the leading cause of death for American women in their reproductive years.

These are only a few of the important advances in our cancer program dedicated to informing and helping the people of America today, while continuing the search for causes, cures and means of preventing all cancers.


The greatest single risk to health and life in the United States is heart disease. Collectively, heart, blood vessel, lung and blood disease affect more than 30 million Americans. High blood pressure is one of the most commonly encountered forms of heart and blood vessel disease, affecting an estimated 23 million adult Americans, or between 10 and 15 percent of the population of the United States.

In my State of the Union message in 1972, I promised to give these diseases increased attention. Later that year I signed into law the National Heart, Blood Vessel, Lung and Blood Act of 1972. To implement that act, I have requested appropriations of $309 million for fiscal year 1975, an increase of $23 million over this year. Special emphasis will be placed on research to prevent heart attacks and high blood pressure. The programs in sickle cell disease will also be continued.


We have long recognized that health problems are universal and that their solution requires international collaboration. We have been heavily involved with activities of the World Health Organization, and we have worked directly with many different countries. Among the most significant of these bilateral activities is our recent agreement with the Soviet Union.

The United States and the Soviet Union have enjoyed 16 years of fruitful relationships in the field of health. From 1958 until 1972, under a general exchange treaty between our State Department and the USSR Foreign Ministry, we have exchanged many of our best medical scientists.

Recently, HEW Secretary Caspar Weinberger, visited the Soviet Union as a guest of Soviet Health Minister Petroysky. During his visit, he inaugurated a new Telex link between the Ministry of Health in Moscow and the Department of Health, Education, and Welfare here in Washington. This new "health line" provides the kind of direct communications necessary for successful fulfillment of the program's goals and has been in daily use since its inauguration.


Finally, I am pleased to report that one of the most successful efforts ever undertaken to improve world health will soon realize its goal--the global eradication of smallpox. This is an activity originally endorsed and consistently supported by the United States.

The Eighteenth World Health Assembly in 1965, at the initiative of the U.S. Delegation, adopted a resolution declaring worldwide eradication of smallpox a major World Health Organization objective. When the program began in 1966, 45 countries reported smallpox. At the end of 1973, this number had been reduced to 11. In 1966, smallpox was endemic in 25 countries. Today it is endemic in only four. In the Americas, where smallpox was a devastating disease for centuries, not a case has been reported since April 1871.

As a result of this global effort, the probability of contracting smallpox in the United States today is virtually nonexistent. There has not been a documented case of this disease in the United States since 1949.

Because of these dramatic results, our Public Health Service has decided that routine immunization of children should no longer be required.


The policies outlined in this message can make 1974 a pivotal year in the history of health care in the United States. By preserving all that is best in our traditional medical system, and by devising the fairest, most efficient means to deal with health challenges that lie ahead, we can strike a uniquely American balance that will preserve the independence and integrity of patient and health professional alike.

"Health," wrote Thomas Jefferson, nearly two centuries ago, "is the first requisite after morality." Today, as we approach our Bicentennial as a nation, we can lay the foundations for a balanced health care system that will convert the age-old ideal of high quality health care for all into a new American reality. I urge the Congress to act rapidly on the measures I am proposing to achieve the objective we all share.


The White House,

February 20, 1974.

Note: On the same day, the President met separately with Republican Congressional leaders and Secretary of Health, Education, and Welfare Caspar W. Weinberger to discuss the message.

The White House also released, on the same day, a fact sheet and the transcript of a news briefing on the message by Secretary Weinberger and Charles C. Edwards, Assistant Secretary for Health, Department of Health, Education, and Welfare.

Richard Nixon, Special Message to the Congress on Health Programs. Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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