A health care crisis awaits America unless extreme measures are taken to combat inefficiency, soaring medical costs, and unhealthy living habits, a former Secretary of the Department of Health, Education and Welfare told an audience of 370 at the Kennedy School last night.

Joseph A. Califano, who served under President Carter, said that America faces an imminent revolution in health care. "At stake are not only billions of dollars but who lives, who dies, and who pays," he said.

Califano, whose speech was part of the Kennedy School's on-going 50th anniversary festivities, also received a medal yesterday as part of the celebration.

He charged that soaring medical costs and the industry's inefficiency may deny medical care even to affluent Americans. This medical crisis could culminate in the first quarter of the next century when 60 million baby boomers will be over 65, signalling "the dawn of a four-generation society."

To combat this potential crisis of spiraling medical costs and the dramatic increaese in the elderly population, Califano said Americans must start to view hospital care as a last resort. He called for the elimination of 400,000 hospital beds across the nation and cut-backs in the number of doctors. Paraprofessionals could provide the same services less expensively and just as competently, he said.

Americans "can do more for [their] own health than any hospital, doctor, medicine or drug," he said, calling for anti-smoking campaigns and diet consciousness. For example, Califano said, in 1984, 43 percent of Chrysler Corporation's health care payments went to only 3.4 percent of its retirees to cure mostly life-style related illnesses, such as drug use or diet.Califano recommended providing incentives forpeople to pursue healthy life-styles such ascharging higher medical and insurance fees tothose who smoke or who don't watch their weight orcholesterol level.

In addition, Califano called for an end tounfair medical practices, such as inconsistentfees for the same illness. In studies he conductedin Massachusetts, residents of Fairhaven,Fitchburg and Framingham were 15 times more likelyto have their tonsils removed than residents ofother areas of the state where antibiotics wereused to treat tonsilitis at a far lower cost, hesaid.

The malpractice system contributes toinefficiency in the medical industry as well,Califano said. The $4 billion spent on insurancepremiums and "billions more wasted on tests bydoctors anticipating possible lawsuits" inflatemedical fees. To combat this, he suggestedadopting laws which limit the amount of pain andsuffering payments that can be awarded.

Despite his warnings, Califano said that thereare hopeful signs in combatting the industry'sills. Hospital admissions, lengths of stays, andoccupancy rates have declined in the past twoyears, he said. Cigarette consumption hasdeclined, as well.

Americans must continue such progress, though,Califano said, if they are to avoid confronting adebate "over who lives and who dies." If thedemand for medical attention greatly exceeds itssupply, the government will be forced to assumethe role of deciding "who gets the next heart,kidney, hip or knee operation and who is entitledto expensive anti-cancer therapy."

During a question and answer period, Califano,who graduated from Harvard Law School and recentlywrote, "America's Health Care Revolution: WhoLives? Who Dies? Who Pays?", said that he was "notinterested" in running for President. He said thatthe Democratic Party is "in trouble" and jokedthat Columbus must have been "a democrat becausehe traveled on borrowed money, didn't know wherehe was going, and didn't know where he was when hegot there.