On the eve of an important committee vote, the White House warned yesterday that failure to enact hospital cost containment legislation will be a serious blow to efforts to hold down inflation.
The House Commerce Committee is scheduled to vote on the bill today. If the committee fails to approve the measure, White House press secretary Jody Powell said, "it would send entirely the wrong signals to the rest of the economy."
President Carter wrote to members of the COmmerce Committee, urging them to approve the measure.
Describing inflation as the nation's "most pressing problem" and the hospital cost containment bill as "one of my top prorities," Carter said in the letter:
"The most important immediate stop this nation can take to hold down the intolerable rise in health costs is to pass legislation containing hospital costs - which constitute 40 percent of health costs and which have been rising about 2 1/2 times faster than the national rate of inflation."
Carter last year sent Congress legislation that would have limited increases in hospital costs to 9 percent anually. It was approved by the Senate Human Resources Committee last summer, but ran into stiff opposition in the House.
The bill the Commerce Committee will vote on today would impose mandatory federal controls only if voluntary efforts to hold down increases in hospital revenues fail.
Powell said the committee vote will be "extremely close," but predicted the administration and other suporters of the measure will "primarily because we must win."
"This is one of the few steps outside the budget that wehave asked Congress to take in the fight against inflation," he said.