An estimated additional 1.5 million social security beneficiaries1.2 million disabled workers, 200,000 people getting disabled child's benefits, 100,000 disabled widows under 65-would be eligible for health insurance benefits. Benefit payments under this proposal in the first year are expected to be $225 million under the hospital insurance program and $100 million under the medical insurance program. (Similar protection would be provided for qualified disabled railroad retirement annuitants.)

6. Social security credit, through transfers of credit, for Federal employment of workers whose Federal service is subject to the civil service or the foreign service retirement system if benefits are not payable to the workers or their families under such system at the time they retire, become disabled or die.

Adoption of this proposal would prevent losses of protection by employees who leave Federal service in the future.

7. An increase from $35 to $50 (from $52.50 to $75 for a couple) in the special payments that were provided under the 1965 amendments and the Tax Adjustment Act of 1966 for certain people age 72 and over who cannot meet the regular insured status requirements of the program.

The increase in these payments would amount to about $240 million in additional benefit payments during the first 12 months of operation. Of this amount, $215 million would be met from general revenues. (The old-age and survivors insurance trust fund pays for the cost of benefits only for those who have worked for more than half a year under the program.) About 1.2 million people would qualify for some payments or higher payments as a result of this proposal.

8. A change in the present coverage requirements for agricultural workers which would provide coverage for the farmworker if he was paid at least $50 (instead of the present requirement of $150) in a year for farmwork by an employer or if he worked at least 10 days (instead of the present requirement of 20 days) in a year for that employer.

This proposal would improve the social security coverage of 500.000 agricultural workers, including migratory workers, who in many instances do not meet the coverage requirements in present law.

9. Coverage of podiatrists' services under the supplementary medical insurance program where the services are of the type now covered if performed by a physician.

10. An increase in the contribution and benefit base to $10,800, to be reached in 3 steps-$7,800 in 1968, $9,000 in 1971, and $10,800 in 1974. 11. Increases in the contribution rates for the cash benefits part of the program. The change scheduled in the employer-employee rate for 1969 under present law (from 3.9 percent each to 4.4 percent each) would be raised by 0.1 percent, to 4.5 percent each. The change scheduled under present law for 1973 and thereafter (to 4.85 percent each) would be raised by 0.15 percent each, to 5.0 percent each.

For the self-employed, the increased scheduled under present law for 1969 (from the present 5.9 percent to 6.6 percent) would be raised by 0.2 percent and thus would come to 6.8 percent. This rate would remain in effect until 1973, at which time the increase to 7.0 percent scheduled under present law would go into effect.

At the present time, the social security program has a significantly favorable actuarial balance; that is, it is expected that over the longrange future the income to the program will considerably exceed the costs of the program. The benefit improvements recommended by the President will cost about 12 percent of covered payroll. It is possible to meet about half of the cost of the recommended benefit improvements from the present favorable balance. The remainder of the cost of the proposed changes would be met through the increases in the contribution rates for the cash benefits part of the program and in the maximum amount of annual earnings subject to the tax and used in computing benefits.

The rate increase averaged over the long run would be equivalent to -one-fourth of 1 percent of payroll; the earnings base increase is equivalent to one-half of 1 percent of payroll. These two financing recommendations would yield income equal to three-fourths of 1 percent of payroll, which, when combined with the actuarial balance of the present system, would fully meet the cost of the recommendations.

Hospital insurance protection for the disabled could be made available without any increase in the hospital insurance contribution rate because of the additional income that would result from the increased contribution base. Supplementary medical insurance protection would also be made available on the same basis as it is for the agedthat is, on a voluntary basis, with the beneficiary paying a monthly premium of $3 and the Federal Government paying a matching

amount.