The Blue Cross-Blue Shield plans, which have had wide enrollment among older people since their inception, have, of course, conducted mass enrollments since 1957 for persons over 65 who did not choose to enroll at an earlier time in life.

Inclusion of Federal-State programs in this chronology is appropriate because there are portions of the population for which voluntarily purchased private health insurance does not normally provide answers to medical financing needs.

Regarding health insurance, the way in which these new approaches have been and are being extended was developed in detail at the subcommittee's April 27-29 hearings.

It should be noted that this chronology takes no account of growth in longer established types of coverage including regular group health insurance coverage of employed and retired persons and the widely held Blue Cross-Blue Shield plans.

Over the latest 10-year period, 1952-62, on which data has been reported, insurance protection against costs of medical care-as a result of these and other continuing developments-has been extended to approximately 9 or 10 million persons over 65, an increase of from 6 to 7 million over the 3.4 million covered in 1952.

Concurrently medical vendor payment progra is under old-age assistance have been improved and expanded to cover more than 2 million persons, an increase in excess of 1 million.

This total of roughly 11 to 12 million covered people is exclusive of persons eligible for the medical assistance for the aged programs created under the 1960 Kerr-Mills Act.

In view of this continuing progress and the fact that nonmedical problems loom large for many older persons, the desire of older people to live independently and with maximum freedom of choice should be respected.

FEDERAL GOVERNMENT'S ROLE

The Federal Government should direct its primary efforts toward encouraging and stimulating:

(1) Improvement in income-for both those now past 65 and those who will attain such age in the future.

(2) Improvement in publicly financed medical care programs

for those who are unable to meet the costs without help.

(3) Continued growth in private voluntary health insurance. (4) Reduction in unfair economic burdens on older people which result from inflation.

The Federal Government should avoid action which (1) would do injury to the Nation's excellent medical care system, or (2) undermine the institution of voluntary health insurance which is contributing so much to that system's growth.

VOLUNTARY INSURANCE RECORD

A comprehensive review of progress in voluntary health insurance for older Americans comparable to that afforded by the proceedings of the subcommittee's April 27-29 hearings is not practical here. Some information relating to important patterns and trends as to the variety of plans available to older people—including those with infirmities and poor health records-on a guaranteed renewable basis, however,

deserves the emphasis which comes with brief repetition and correlation.

Apparently most of the health insurance coverage of persons past 65 is divided about equally between Blue Cross-Blue Shield and health insurance companies. Both make protection available to older persons through group plans, mass enrollments, and individual underwriting.

Walter J. McNerney, president of the Blue Cross Association reporting to the subcommittee that persons past 65 represent 9.1 percent of the total Blue Cross enrollment, commented at the April 27-29 hearings:

This percentage is practically the same as the percentage of senior citizens in the total national population.

With reference to steps taken by Blue Cross plans on behalf of older persons, Mr. McNerney said:

Every Blue Cross plan in the United States has enrolled senior citizens through some combination of the following methods. You have already heard of most, if not all, of the methods.

Blue Cross has stimulated management and labor interest in retaining retired workers within groups of those actively employed.

Members leaving a group are encouraged to convert to an individual, direct-pay basis. Open enrollment periods are held during which all persons in the community including the aged are able to enroll. Special programs for the aged have been designed and offered.

We do not as a matter of practice cancel anybody who has become a member of Blue Cross. Our benefits are designed to be as helpful and as economical as possible and we believe that the rates covering these benefits are probably lower for comparable coverages than almost any you can find by any responsible carrier.

Those on group rates, those aged that are part of a group, receive the same rates and benefits as other members of the group. In many instances this care is financed completely or in part by the employer.

Mr. J. F. Follmann, Jr., director of information and research, Health Insurance Association of America, summarized a description of expanding types of coverage available through health insurance companies as follows:

There are nine principal methods being employed by insurance companies to make health insurance available to both the present aged population as well as those that will become senior citizens in the future.

These methods include both group approaches, mass enrollment techniques, and individual coverages of various types. In addition, there are, of course, coverages available through Blue Cross and Blue Shield plans. It is clear that private health insurance is generally available, regardless of physical condition, for both the present and future aged.

Almost half of the aged insured with insurance companies are covered under group policies. For such persons, it is not infrequent that the employer pays some or all of the premium charge.

Vigorous competition among insurance companies and Blue Cross plans, all under the supervision of State insurance departments, assures the public of a reasonable relationship between benefits and premiums in the instance of both group and individual policies.

Testimony by other witnesses at the April 27-29 subcommittee hearings confirms the opinion that there has been substantial expansion in the scope of benefits provided by voluntary health insurance coverages. The combination of public spirit and intense competition reflected in the record, and in statements by the several representatives of Blue Cross and the insurance industry, has produced further a situation in which the number and percentage of persons past 65 with private health insurance clearly is increasing rapidly.

INCREASES IN HEALTH INSURANCE COVERAGE

According to a Social Security Administration study made in March 1952, 3.4 million persons past 65 held health insurance, or 26 percent of the noninstitutionalized aged.

A September 1956 2 study, also made by the Social Security Administration, showed an increase in coverage to 36.5 percent of the older population.

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A third study, by the Department of Health, Education, and Welfare, made in the fall of 1959, showed still another increase to 46.1 percent. At about the same time a Health Insurance Association of America study (December 1959) showed voluntary health insurance coverage of 49 percent of the persons 65 and over.

The most recent data supporting this growth pattern was reviewed at the April hearings by the subcommittee and was based on three different studies.

The National Center for Health Statistics, Public Health Service, study showed voluntary health insurance coverage as of 1962 to be 54 percent of the noninstitutionalized aged.

The study reported by the Division of Research and Statistics, Social Security Administration, showed 1962 coverage of 51 percent of all persons past 65. When allowance is made to exclude the institutionalized aged, this study corresponds closely to the Public Health Service data. Both studies employed household interviews of older people.

The third set of data for 1962 is that from the Health Insurance Association of America based on a survey of insurance company records and coverages reported from other sources for Blue Cross and other type plans. It concluded that 60 percent of the noninstitutionalized persons past 65 were insured.

1 I. S. Falk and Agnes W. Brewster, "Hospitalization and Insurance Among Aged Persons, A Study Based on a Census Survey in March 1952," Bureau Rept. No. 18, Division of Research and Statistics, Social Security Administration, Washington, D.C., April 1953.

2 "Hospitalization Insurance for OASDI Beneficiaries." report submitted to the Committee on Ways and Means by the Secretary of Health, Education, and Welfare, Washington, D.C., Apr. 3, 1959, p. 43.

3 U.S. National Health Survey, "Interim Report on Health Insurance, Health Statistics, series B-26, U.S. Department of Health, Education, and Welfare. PHS Publication No. 584-B26, Public Health Serv ice, Washington, D.C., December 1960.

Regardless of differences in survey techniques, each of these threestudies demonstrates a growth situation the magnitude of which cannot be ignored.

This recent record and new developments commented on earlier indicate continued future expansion of coverage and benefits despite the fact that already well over half the 65-plus population is now insured.

It is understandable that those who advocate replacing the voluntary movement with a compulsory scheme choose to close their eyes. to this impressive record. Only by so doing can they persist in claims of a vast unmet need, a need which, in fact, is steadily diminishing. It is declining not alone as a result of newly available voluntary health insurance, but also as a result of expanding Government assistance programs for those in need of help and as a result of improving economic situations among those who have and will attain age 65.

The improvement in basic economic capacity among older people has been vigorously supported by the minority. Our efforts toward this objective will be continued aggressively.

It appears prudent to build on what we have. Federal policies and actions, therefore, should continue to emphasize effective encouragement of voluntary health insurance offering older people a wide variety of choice to be freely exercised by them as individuals.

FEDERAL-STATE SUPPLEMENTARY PROGRAMS

Efforts to evaluate the effectiveness of voluntary health insurance alone, without reference to other resources of older people, inevitably produce an incomplete picture. Disregard of voluntary health insurance in appraising Government programs similarly produces an incomplete and obviously faulty record.

Some advocates of special points of view, in their eagerness to make a case, unfortunately have succumbed to just such temptations. To avoid this error, the minority believes that a brief review of existing Federal-State programs is called for.

The past 10 years have seen substantial expansions in coverages and medical benefits for the 12 to 14 percent of the over-65 population who rely on Federal-State old-age assistance programs.

According to the 1952 Annual Report of the Federal Security Agency, there were, in that year, 13 States participating in the modest Federal-State program of OAA vendor payments for medical care authorized by the Congress in 1950. Medical services under these programs were available to approximately 550,000 old-age assistance recipients. Seven other States, with a total of approximately 425,000 OAA recipients, had medical vendor payment programs without Federal participation.

These State and Federal-State programs together made medical services available to approximately 975,000 persons.

Expansions of the medical vendor payment programs were authorized by the Congress in 1956, 1958, and, most recently, under the Kerr-Mills Act in 1960. All 50 States, as a result, have now undertaken, with greatly expanded benefits, this type of program for older persons presumed to be in greatest need.

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As of December 1962, the number of persons thus covered was 2,225,731. This increase of over 1 million is significant in any appraisal of coordinated governmental and voluntary efforts to meet the medical needs of older people.

More recent than the OAA programs, and still developing rapidly, is the medical-assistance-for-the-aged program authorized by Congress in 1960. Its very newness, and current recordkeeping practices under the program, make accurate statistical evaluation difficult, but it constitutes a major step in meeting medical needs of many older per

sons.

This program, based on Federal grants to the States, is intended to provide help to older persons who are not on old-age assistance rolls, but need aid in meeting medical expenses. The law requires that State programs make available both institutional and noninstitutional

care.

Thirty-nine States and the District of Columbia have enacted necessary legislation, including assignment of funds, for implementatation of medical-assistance-for-the-aged programs. Two additional States have authorized the program.

It should be noted that, of the nine States which have taken no action to implement MAA under the Kerr-Mills Act, five have, presumably as a result of other provisions of that act, extended the medical vendor payments program to old-age assistance recipients since 1960 for the first time. Three others expanded existing OAA medical programs. That the first steps by these States should be for the benefit of those in greatest need is understandable.

It is a reasonable assumption that, with the experience thus gained, these States, too, will make medical-assistance-for-the-aged programs available. Current legislation now under consideration by several gives support to this assumption.

Action by the States on the medical-assistance-for the-aged program since adoption of the Kerr-Mills Act, has not been confined to passage of original enabling legislation. A number of States have expanded their MAA programs. It may be expected that this process of making eligibility rules and benefits more reasonably match the need of older people will continue.

It is impossible, on the basis of data available, to know how many persons past 65 are, or will be, eligible for help under the 40 fully authorized medical-assistance-for-the-aged programs. Some are not yet in operation; others have been in existence less than a year. Calculation of numbers eligible is further complicated by the fact that the only current records simply show, for specific months, the number of persons who actually receive benefits. Since only a small portion of those eligible require services during a given month, such figures give but little indication of the programs' scope. It is clear, however, that the number eligible for services is substantial and growing.

Vigorous steps, based on careful and positive-minded study, certainly should be undertaken at both Federal and State levels to assure full implementation of the medical assistance for the aged program in accordance with the intent of the Congress.

4"Advance Release of Statistics on Public Assistance," Division of Program Statistics and Analysis, U.S. Department of Health, Education, and Welfare, Washington, D.C., December 1962.