It is common knowledge, even to the statistical layman, that the size of a sample is not the sole determinant of its validity.

A number of questions immediately occur, therefore, regarding use of the raw data supplied by these companies-questions which are not answered by the record. They include the following: Were the samples selected by methods recognized as statistically valid? How heavily weighted was the sample with reference to applications for major medical coverages or other types of insurance normally purchased subsequent to other policies? Did the responses reveal other basic hospital coverage only, or were they based on questions which referred to all types of coverage? Is it probable that persons applying for the types of policies reported on would be those most interested in supplementary coverage? Is it known how many of the applications actually resulted in issuance of a policy?

Answers to these and other possibly pertinent questions do not appear in the subcommittee record.

The second way in which the majority statement chose to try and discredit the HIAA 13-percent duplication estimate was through questions directed to Dr. Linder in which he expressed the opinion that underreporting of this item may have been high in the Public Health Service survey made under his supervision.

The danger of underreporting on a question in any household survey of the type conducted under direction of Dr. Linder, and incidentally, that conducted under direction of Dr. Merriam for the Social Security Administration, is commonly acknowledged. Recognition is clearly given to this danger by the Census Bureau in many of its reports and by others working in the statistical study field.

It is a factor which unquestionably must be considered in evaluating all household interview type surveys. Whether a person's age is a factor in the extent to which underreporting produces statistics below actual facts is not clear. There is a distinct possibility, however, that this method may produce figures lower than those arrived at through other survey methods.

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That this can sometimes be significant is shown by a 1959 Public Health Service study of "Reporting of Hospitalization in the Health Interview Survey" conducted as part of the U.S. National Health Survey. This showed underreporting of hospital episodes for the survey year which ranged from 8 percent in the 18 to 34 age group to 18 percent in the 65 to 74 age group and 14 percent in the age group 75 and over.

If people will forget they have been in a hospital during the preceding year, it is understandable that they would forget hospital insurance policies.

For this reason credence might well be given to the possibility that the duplication figure produced by Dr. Linder's report may be too low. If there is understatement on this point, however, it is equally probable that there has been understatement with reference to holding of health insurance at all. It is regrettable that this has not been given recognition in the majority statement.

Even more regrettable, as mentioned before, is that statement's failure to recognize the tremendous strides yes, "strides"-shown by

U.S. National Health Survey, "Reporting of Hospitalization in the Health Interview Survey," Health Statistics, series D-4, Michigan University, Survey Research Center. PHS Publication No. 584-D4, Public Health Service, Washington, D.C., May 1961.

all data in the record that have taken place in voluntary health insurance coverage of older persons.

As pointed out earlier in these minority views, attention of the subcommittee was directed, during the April 27-29 hearings, to three different studies with reference to the number of persons past 65 holding private health insurance. Their estimates as to the increase during the 10 years between 1952 and 1962 range from approximately 170 to 200 percent.

The percentage of noninstitutionalized older persons now covered by voluntary health insurance has more than doubled over the 1952 percentage according to all three of these studies.

Unquestionably more than half of older Americans have such insurance. The number and percentage appears to be growing every month.

HEALTH INSURANCE COSTS

The majority report concludes with a discussion of rising costs of health insurance and advances a program for financing hospital carethrough the social security system as the alternative.

We are fully conscious of the need of health insurers to adjust the cost of insurance periodically, as they are compelled to do with respect to health insurance coverages for persons at all ages. The reason for this is readily apparent.

Any method of financing health care whether it be through personal means, voluntary health insurance, philanthorpy, public assistance programs, veterans facilities, or the proposed social security approach-must be directly responsive to costs of providing that care. These costs have been rising, in the main very understandably, as our system of health care continues to improve in quality, and to respond to human needs and ever-advancing scientific techniques.

These improvement have relieved suffering and extended the span. of life. They are greatly to be desired. Frequently they are costly to achieve. The American public has clearly displayed a choice in. favor of them, and increasingly finances these services through voluntary health insurance.

If the majority intend to imply that these rising costs of care are only reflected in the cost of health insurance, and that the financing of these costs through the OASI system would somehow avoid this process, they are in error.

The cost of health care must be reflected in any financing method. To do otherwise would be to retard rapid progress being made with respect to health care in the United States or possibly produce an actual setback in our medical care system.

As was brought out by both private and Government witnesses before the House Ways and Means Committee in 1963, currently proposed financing of social security administered hospital care plans is grossly inadequate. In addition, and even if adequately financed, the benefits of the proposed program do not by any means fit the majority's stated concept of coverage adequacy.

According to spokesmen for the Department of Health, Education, and Welfare,' older people would still have to pay 70 to 75 percent

7 Wilbur J. Cohen, Assistant Secretary for Legislation, Department of Health, Education, and Welfare, "Financing Medical Care for the Aged Through Social Security," an address presented to the Junior Branch of the Actuaries Club of New York, Mar. 18, 1964; and

U.S. Congress, House, Committee on Ways and Means, hearings on H.R. 3920, 88th Cong., Nov. 18, 1963, pt. 1, p. 63. Testimony by Robert M. Ball, Commissioner of Social Security Administration, Department of Health, Education, and Welfare.

of their health care costs from their own resources. This situation impresses and concerns minority members of the subcommittee.

Equally disturbing is the threat such a medical program would be to the ability of the social security system to pay higher cash benefits now and in the future.

For these and other valid reasons, we remain convinced that the majority's conclusion is unwarranted.

INDIVIDUAL VIEWS OF SENATOR HIRAM L. FONG

SUMMARY OF FINDINGS

The record developed during 3 days of hearings by the Subcommittee on Health of the Elderly, which I attended, can be briefly

summarized as follows:

1. Over the past 10 years, tremendous progress has been made in health insurance benefits and care for the aged and in numbers of persons past 65 having health insurance coverage.

Broader, more comprehensive benefits, guaranteed renewable (nonrevocable) provisions, group insurance, mass enrollments, and other improvements described in the hearings are solid evidence of progress.

Further improvement in aged health insurance is expected.

2. Some 54 to 60 percent of the Nation's approximately 17 million noninstitutionalized people age 65 or older have voluntary health insurance. Another 12 to 14 percent of this aged group have medical coverage through old-age assistance, and an indeterminate additional number are eligible for medical assistance for the aged.

3. Approximately one-half of those with voluntary health insurance are under nonprofit Blue Cross protection; the other half have insurance written by private companies, many of which are nonprofit. 4. A great variety of health insurance plans are presently available from which the elderly may choose policies best matching their needs and willingness and ability to pay.

No accurate judgment is possible as to how many of older persons have "adequate" coverage. What is adequate for one person may not be adequate for another. What is adequate in a low-cost area may not be adequate in a high-cost area. The hearing record did not develop sufficient information on adequacy.

5. Costs of health care are rising and this trend is expected to continue. Whether health care is financed through Government expenditures or individual insurance premiums, such financing must be adjusted from time to time to reflect these rising costs.

MAJORITY REPORT BIASED AND INCONSISTENT

The majority report distorts the record of hearings by failing to cite the obvious progress made in health protection for older Americans. It lacks balance and objectivity by ignoring the substantial public service rendered by nonprofit Blue Cross and private insurance companies in behalf of the aged.

The evident bias of the majority report against voluntary health insurance is very disturbing, for the total impact seems designed to undermine confidence of existing policyholders and prospective policyholders-aged and young alike—in fine organizations like Blue Cross. This is a great disservice to the people of America.

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For the majority report to condemn the vast majority of voluntary aged health insurance as inadequate and then to recommend instead the administration's hospital insurance plan, which administration spokesmen admit will cover only 25 to 30 percent of aged health care costs, is inconsistent to say the least.

COMPREHENSIVE INSURANCE NOW AVAILABLE

The hearings showed that there are presently available for older persons policies offering comprehensive hospital, surgical, and other major medical benefits on a guaranteed renewable basis. The premiums naturally reflect the comprehensive benefits.

From the hearings it is clear that those who can afford and who are willing to pay the premiums for such coverage can obtain it.

It is also clear from the hearing record that some-how many no one knows-of those 65 and older cannot afford to pay the premiums. for the best policies available.

FINANCING IS HEART OF PROBLEM

The central problem in providing health insurance protection is financing.

Available statistics on the financial status of our aged population are very sketchy, too incomplete to derive an accurate picture. It is reasonable to say, however, that a good many older persons lack the wherewithal to buy comprehensive health insurance.

Old-age assistance takes care of medical care costs of those without resources. This program should be improved through Federal-State cooperation.

Medical assistance for the aged takes care of a growing number of persons who are normally self-sustaining but who cannot pay for needed medical care. The Federal law is so broad that States have great leeway to provide substantial benefits and liberal eligibility requirements. This the States should do.

Persons of means can afford voluntary health insurance.

It is those aged not in the OAA, MAA, or affluent categories that arouse my further concern.

I agree with the minority views that steps must be taken to raise the income of persons past 65 and of those who will attain such age in the future.

I agree that public policy must make war on inflation, to stop the cost-price squeeze on those with fixed incomes as so many older citizens

are.

In this connection with regard to costs, I interject to urge all those comprising the health care industry vigorously to explore ways to reduce spiralling costs while maintaining high standards.

But beyond this, I further believe additional Federal legislation is needed to assist older persons to finance comprehensive health protection, with the Federal share paid out of general revenues of the Treasury. This is the equitable way to distribute the cost of such a

program.