A-14368, JUNE 16, 1926, 5 COMP. GEN. 989

A-14368: Jun 16, 1926

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ONE FOR THE GENERAL PUBLIC WHO ARE ABLE TO PAY THE FULL PRICE AND OTHERS FOR POOR OR INDIGENT PATIENTS. THE SCHEDULE OF RATES FOR THE GENERAL PUBLIC IS THE MAXIMUM FOR CONSIDERATION BY THE BUREAU IN LETTING CONTRACTS FOR THE CARE OR TREATMENT OF ITS BENEFICIARIES. WHETHER OR NOT SUCH RATES ARE LESS THAN ACTUAL COST BECAUSE OF AN ENDOWMENT OF PUBLIC OR PRIVATE FUNDS. THE VETERANS' BUREAU IS NOT GENERALLY AUTHORIZED TO ENTER INTO A CONTRACT WITH SUCH AN INSTITUTION FOR THE CARE OR TREATMENT OF ITS BENEFICIARIES AT RATE IN EXCESS OF THOSE CHARGED OTHER PATIENTS FOR THE SAME SERVICE. AS FOLLOWS: THERE IS RESPECTFULLY PRESENTED FOR YOUR CONSIDER THE QUESTION OF THE APPLICATION IN THE FOLLOWING CASES OF YOUR DECISION OF OCTOBER 31.

A-14368, JUNE 16, 1926, 5 COMP. GEN. 989

VETERANS' BUREAU - MEDICAL TREATMENT AS A GENERAL RULE, CONTRACTS SHOULD NOT BE ENTERED INTO BY THE VETERANS' BUREAU WITH STATE, COUNTY, OR PRIVATE INSTITUTIONS FOR THE CARE OR TREATMENT OF BENEFICIARIES OF THE BUREAU AT RATES IN EXCESS OF THOSE CHARGED OTHER PATIENTS WHO PAY FOR THE SAME SERVICE, BUT WHERE AN INSTITUTION MAINTAINS TWO OR MORE SCHEDULES OF RATES, ONE FOR THE GENERAL PUBLIC WHO ARE ABLE TO PAY THE FULL PRICE AND OTHERS FOR POOR OR INDIGENT PATIENTS, THE SCHEDULE OF RATES FOR THE GENERAL PUBLIC IS THE MAXIMUM FOR CONSIDERATION BY THE BUREAU IN LETTING CONTRACTS FOR THE CARE OR TREATMENT OF ITS BENEFICIARIES. WHERE AN INSTITUTION MAINTAINS BUT ONE GENERAL SCHEDULE OF RATES FOR THOSE ABLE TO PAY, WHETHER OR NOT SUCH RATES ARE LESS THAN ACTUAL COST BECAUSE OF AN ENDOWMENT OF PUBLIC OR PRIVATE FUNDS, THE VETERANS' BUREAU IS NOT GENERALLY AUTHORIZED TO ENTER INTO A CONTRACT WITH SUCH AN INSTITUTION FOR THE CARE OR TREATMENT OF ITS BENEFICIARIES AT RATE IN EXCESS OF THOSE CHARGED OTHER PATIENTS FOR THE SAME SERVICE.

COMPTROLLER GENERAL MCCARL TO THE DIRECTOR, UNITED STATES VETERANS' BUREAU, JUNE 16, 1926:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF MAY 14, 1926, AS FOLLOWS:

THERE IS RESPECTFULLY PRESENTED FOR YOUR CONSIDER THE QUESTION OF THE APPLICATION IN THE FOLLOWING CASES OF YOUR DECISION OF OCTOBER 31, 1923, RELATIVE TO THE HOSPITALIZATION OF INSANE BENEFICIARIES OF THIS BUREAU.

IN THE LAST PARAGRAPH OF YOUR DECISION OF OCTOBER 31, SUPRA, THE FOLLOWING LANGUAGE WAS EMPLOYED:

"YOU ARE ADVISED, ALSO, THAT CONTRACTS WITH STATE OR PRIVATE INSTITUTIONS FOR CARE OF INSANE BENEFICIARIES OF THE VETERANS' BUREAU SHOULD NOT BE ENTERED INTO AT A HIGHER RATE THAN CHARGED OTHER PATIENTS OF SUCH INSTITUTIONS FOR THE SAME SERVICE.'

THIS BUREAU HAS OBSERVED THE RULE LAID DOWN IN THAT PORTION OF YOUR DECISION AS QUOTED ABOVE IN AWARDING CONTRACTS FOR GENERAL HOSPITAL SERVICES, AND HAS REFUSED TO ACCEPT PROPOSALS FOR SUCH HOSPITAL SERVICE WHERE THE PER DIEM RATE STIPULATED IN THE PROPOSALS SUBMITTED WAS IN EXCESS OF THAT ORDINARILY ASSESSED UPON OTHER PATIENTS AT SUCH HOSPITALS FOR THE SAME SERVICE.

THE APPLICATION IN CERTAIN CASES OF THIS RULE HAS, HOWEVER, GIVEN RISE TO SITUATIONS WHICH APPEAR TO WARRANT A REQUEST FOR AMPLIFICATION OF THE QUOTED PORTION OF YOUR DECISION, SUPRA.

IN THIS CONNECTION ATTENTION IS INVITED TO A PROPOSAL FROM THE RHODE ISLAND HOSPITAL, PROVIDENCE, RHODE ISLAND. THERE WAS TRANSMITTED WITH THE PROPOSAL REFERRED TO A STATEMENT FROM THE SUPERINTENDENT OF SUCH HOSPITAL WHEREIN ADVICE IS AFFORDED THAT SUCH HOSPITAL IS OPERATED AS A CHARITABLE ENTERPRISE; THAT THE ACTUAL COST OF THE CARE OF A PATIENT IS $4.10 PER DAY, THE AMOUNT STIPULATED IN THE PROPOSAL SUBMITTED; AND THAT ALTHOUGH $1.10 OF THIS AMOUNT WAS PAID FROM A PRIVATE ENDOWMENT FUND, THE OFFICIALS OF SUCH HOSPITAL CONSIDERED THAT THE GOVERNMENT SHOULD PAY THE ACTUAL COST OF MAINTAINING ITS BENEFICIARIES AT THAT HOSPITAL. A COPY OF THE STATEMENT FROM THE SUPERINTENDENT REFERRED TO IS ATTACHED FOR YOUR INFORMATION.

THIS BUREAU IS ALSO IN RECEIPT OF A PROPOSAL FROM THE MASSACHUSETTS EYE AND EAR INFIRMARY, BOSTON, MASSACHUSETTS. THE PER DIEM RATE IN THE PROPOSAL SUBMITTED IS $5.17. IT IS ADMITTED THAT THE GENERAL RATE OF BOARD AT SUCH HOSPITAL IS $21.00 PER WEEK AND THAT AS A CHARITABLE MEASURE THE HOSPITAL AUTHORITIES REMIT THE DIFFERENCE BETWEEN $3.00 PER DAY AS COMPUTED ON THE $21.00 BASIS AND THE PER CAPITA COST OF $5.17 PER DAY AS STIPULATED IN THE PROPOSAL SUBMITTED TO THIS BUREAU. IN A LETTER DATED SEPTEMBER 16, 1925, THE DIRECTOR OF SUCH HOSPITAL EXPRESSES HIS RELUCTANCE TO EXECUTE THE USUAL WARRANTY CONTAINED IN PROPOSAL FORMS FOR HOSPITAL SERVICE TO THE EFFECT THAT THE RATE CHARGED IN SUCH PROPOSAL IS NOT IN EXCESS OF THE RATE CHARGED OTHER PATIENTS FOR THE SAME SERVICES WHO ARE NOT BUREAU BENEFICIARIES. THE OBSERVATION IS ALSO MADE IN SUCH COMMUNICATION THAT THE OFFICIALS OF SUCH HOSPITAL DO NOT BELIEVE THAT IT IS THE INTENTION OF THE FEDERAL GOVERNMENT TO REQUEST FROM A LOCAL CHARITY ITS INDULGENCE TOWARD WORLD WAR VETERANS. A COPY OF SUCH LETTER IS ATTACHED FOR YOUR INFORMATION.

THERE IS THUS PRESENTED FOR CONSIDERATION THE QUESTION WHETHER UNDER YOUR DECISION OF OCTOBER 31, SUPRA, THIS BUREAU IN SOLICITING PROPOSALS FOR HOSPITAL SERVICES OF ANY CHARACTER IS REQUIRED TO INSIST UPON PARTICIPATION IN SPECIAL ENDOWMENT OR CHARITABLE FUNDS, THUS, IN EFFECT, RENDERING BUREAU BENEFICIARIES OBJECTS OF PUBLIC CHARITY.

THE RULE ANNOUNCED IN THE DECISION OF OCTOBER 31, 1923, ABOVE QUOTED, THAT RATES UNDER CONTRACTS FOR CARE OR TREATMENT OF INSANE BENEFICIARIES SHOULD NOT EXCEED RATES CHARGED OTHER PATIENTS WHO PAY FOR THE SAME SERVICE IN THE CONTRACTING INSTITUTION, IS NOT A REQUIREMENT OF STATUTE, BUT IS A WELL-ESTABLISHED POLICY OF THE GOVERNMENT. IT IS SIMPLY THE APPLICATION TO THE PARTICULAR MATTER INVOLVED OF THE GENERAL POLICY OF THE GOVERNMENT NOT TO PAY FOR SERVICES OF ANY NATURE PERFORMED BY PUBLIC, QUASI PUBLIC, OR OTHER INSTITUTION DEALING WITH THE PUBLIC AT RATES IN EXCESS OF THOSE CHARGED THE GENERAL PUBLIC. NO ARGUMENT NEED BE ADVANCED IN SUPPORT OF THIS MOST REASONABLE POLICY. IT IS SO WELL ESTABLISHED AS TO BE EQUIVALENT TO A GENERAL PROHIBITION.

LARGE NUMBERS OF HOSPITALS AND OTHER INSTITUTIONS ESTABLISHED AND MAINTAINED FOR THE CARE AND TREATMENT OF THE SICK AND DISABLED ARE ENDOWED FROM PRIVATE OR PUBLIC FUNDS. THE GOVERNMENT ITSELF IN CERTAIN INSTANCES APPROPRIATES FUNDS IN AID OF SUCH INSTITUTIONS. THE PURPOSE OF THESE ENDOWMENTS IS EITHER TO ENABLE THE INSTITUTION TO CARE FOR POOR OR INDIGENT PATIENTS OR TO REDUCE THE CHARGE TO ALL THOSE ENTERING THE INSTITUTION. AND IN FACT IT IS PROBABLE THAT ENDOWMENTS ARE OFTENTIMES MADE WITH A STIPULATION AS TO A CERTAIN LIMITATION OF THE AMOUNT TO BE CHARGED PATIENTS ENTERING THE INSTITUTION.

OF COURSE, BENEFICIARIES OF THE VETERANS' BUREAU ARE NOT TO BE CLASSED AS POOR OR INDIGENT PATIENTS FOR THE PURPOSE OF OBTAINING MEDICAL OR HOSPITAL TREATMENT FOR THEM BY THE GOVERNMENT WITHOUT COST OR AT REDUCED RATES.

THUS WHERE STATE, COUNTY, OR PRIVATE INSTITUTIONS MAINTAIN TWO OR MORE SCHEDULES OF RATES, ONE FOR THE GENERAL PUBLIC, WHO ARE ABLE TO PAY FULL PRICE, AND OTHERS FOR POOR AND INDIGENT PERSONS, THE RATES FOR THE GENERAL PUBLIC ARE THE MAXIMUM RATES FOR CONSIDERATION BY THE VETERANS' BUREAU IN LETTING ITS CONTRACTS FOR CARE OR TREATMENT OF BUREAU BENEFICIARIES.

BUT WHERE STATE, COUNTY, OR PRIVATE INSTITUTIONS, WHETHER ENDOWED BY PUBLIC OR PRIVATE FUNDS OR NOT, MAINTAIN ONLY ONE SCHEDULE OF RATES FOR THE GENERAL PUBLIC IRRESPECTIVE OF THE FINANCIAL STANDING OF THE PATIENTS OR THEIR ABILITY TO PAY, THE VETERANS' BUREAU IS NOT GENERALLY AUTHORIZED TO ENTER INTO ANY CONTRACT WITH SUCH INSTITUTION AT RATES IN EXCESS OF THOSE CHARGED THE GENERAL PUBLIC. IN OTHER WORDS, THE GOVERNMENT MAY NOT BE SINGLED OUT BY AN INSTITUTION AND BE REQUIRED TO PAY RATES IN EXCESS OF THOSE CHARGED THE GENERAL PUBLIC FOR THE SAME SERVICE. THERE WOULD APPEAR TO BE NO GOOD REASON WHY THE GOVERNMENT SHOULD NOT HAVE THE ADVANTAGE OF REDUCED RATES IN INSTITUTIONS WHICH ARE SUPPORTED IN WHOLE OR IN PART BY ENDOWMENT FUNDS UNDER THE CONDITIONS ABOVE MENTIONED.