Evening star., 1937-12-17


Group Health Association, Inc,
set up by Federal Home Loan Bank
Board, to serUe its employees and
those OF Home OWners' Loan Corp.
and affiliated agencies here uith
medical care has been attacked as
"soctalised medicine" and for
spending funds in alleged illegal
manner. 1t is stoutly defended By
experts OF F. H. L. B. B.
Action of the Home Owners Loan
Corp. in advancing more than S37 1000
to Group Health Association, Inc, for
its employees, was held to be without
authority of law" by Acting Controller
General Richard N Elliott, in an
opinion submitted today to Senator
McCarran, Democrat. of Nevada.
The ruling went further by suggest
ing that the maintaining of emergency
rooms in various other Government
agencies is Of doubtful legality.
After hasty reading of the opinion,
Senator McCarran called for legislation
by Congress to prevent recurrence of
such expenditures not specifically
authorized by Congress.
Fe said it is for Congress to de-
termine now what should be done in
this particular instance.
Hopes for Specific Legislation.
Il hope it will result in specific leg
lsiation making it impossible for this
10 recur in Government departments.
said Senator McCarran. In other
words, if Congress IS charged with the
responsibility OF handling public
money and the duty of appropriatins
it, no department should take on
itself authority to divert public money
from the object for which appropri-
ated to some other object the depart
ment may think worthy.
The action of the H. o. L. c. Is
he'd to he without authority of law,
and therefore illegal, and should sub
ject some one to become Immediately
anenah8e to the law Whether it
woGlc result in a cleaning of house
or putting the department again in
conformity with the Law, is a question
for Congress.
However. this stands as an example
Of what may be going on in depart
ments and should result in legisla-
ton aith teeth in it.
1t Hlso has developed one Of the
reasons why the General Accounting
Oft1ce should be maintained" the
Senator said, referring to proposals
that hsve been made to reorganize
THAI Independent agency and limit its
present auditing powers
However. l am at a loss to know
how thg money was diverted without
the arrroval of the General Account
ing OG.ce."
S.ists Various Documents.
Mr.. Elott's opinion, which was re-
queste,9 rv the Nevada Senator, began
by AtIng various documents and
pspe-E connected with the formation
Of thu Group Health Plan, and the
agreement Of corporation officials to
assist IT. figiacing it.
MI. El4!0et said that in pursuance
ro an agtseIatnt of March %, 1887, as
ameldec hy resolutions of August 10
al.d Ser't 4 7er 9, adopted by the di-
rectois - = D. L. c., there has been
advance. 20 the Group Health Asso-
ciatior. inc, cash in the amount of
$4,000, which is recorded in the books
OF the corporation as prepaid expense
In addition to the foregoing, the
corporation has purchased on behalf
of the association, certain supplies and
equipment in the sum of S7,357.65. the
net amount of which is reflected on
the books of the corporation as 'ac-
counts receivable representing the
following transactions which are set
out in detail as an indication of prob
able administrative COSTS"
Still Being Maintained.
After pointing out that the group
health plan went into operation No
vember l. the opinion adds that the
emergency rooms Of the corporation
are still being maintained (an activity
similar to those maintained in most
| departments and establishments which
| are of doubtful legality and that
| physical supervision of the rooms was
taken over by the Group Health As
sociation, Inc, on December /, 1887,
although the four nurses employed are
carried on the rolls of the corpora
ton"
The acting controller general states
| that officials of H. o. L. c. said ad-
vancement of health funds was to re-
lieve the corporation of the expense
of operating the emergency room, "es-
timated by the controller of the cor
poration to cost approximately $4,000.
However, the general counsel, subse-
quently, Informally voiced an opinion
that such costs would not exceed
(See HEALTH, Page A-4)