Testimonies and related materials from a Congressional hearing on Medicare and Medicaid reform are presented. Chairman Mike Synar's opening remarks deal with the need to maintain quality health care and access to care in the era of such cost containment policies as Diagnostic Related Groups. The chairman calls for reform of the Medicare and Medicaid systems to reprioritize full access to health care. Statements are also given by Congressmen Robinson and Coleman. Two state representatives from the Texas House of Representatives testify about the Texas legislative response to health care needs of the poor and elderly and their concerns about the Medicare and Medicaid programs. A private senior citizen testifies about her health care cost problems. A representative from the American Association of Retired Persons discusses a Medicare analysis he oversaw in Texas and the survey results. Two representatives from the El Paso Interreligious Sponsoring Organization discuss their experiences with health care costs and the indigent population of El Paso. A Texas hospital administrator testifies on his institution's difficulties with the Diagnostic Related Group program. Testimony from a representative of the Texas Department of Human Resources considers the potential adverse effects of reduced Medicaid funding. (ABL)