Answer 7. Herewith is a copy of a statement by Mr. W. N. Seery, vice president of the Travelers Insurance Co., to the Insurance Committee of the Connecticut General Assembly on March 7, 1961. This statement describes the purposes and aims of the program. Also enclosed is a statement by Mr. Seery as chairman of the Executive Committee of Connecticut 65 at a public hearing called by Commissioner Alfred N. Premo of the Connecticut State Insurance Department on October 23, 1963. This statement and the exhibits with it describe the progress and situation of Connecticut 65 at that time. Following the hearing the modest changes in premium rates and benefits indicated in answer 6 above were made effective. Additional information with respect to the number of people insured is included in answers 2 and 3 above. The claim and premium figures in answer 5 above include claims and premiums to March 1, 1964, as requested. A new insurance program requires analysis and study of a continual nature and adjustments are to be anticipated as the need arises. It will be noted from the statement on October 23, 1963, that claim rates have somewhat exceeded our anticipations. Steadily increasing medical and hospital rates are also having their effect and are expected to continue in the future. However, at this point the Executive Committee of Connecticut 65 has made no decisions as to any further premium or benefit adjustments. CONNECTICUT 65, ASSOCIATED CONNECTICUT HEALTH INSURANCE COS., Hartford, Conn., March 20, 1964. Hon. PAT MCNAMARA, Chairman, Subcommittee on Health of the Elderly, U.S. Senate, Washington, D.C. DEAR SIR: We have for acknowledgment your letter of March 10 addressed to the Associated Connecticut Health Insurance Cos., and requesting certain information relative to Connecticut 65. We are reviewing our records and the full reply will be sent to you later. Sincerely yours, WILLIAM N. SEERY, Chairman, Executive Committee. MARCH 10, 1964. PRESIDENT, ASSOCIATED CONNECTICUT HEALTH INSURANCE CO., DEAR SIR: As you may know, the Subcommittee on Health of the Elderly has announced that it will hold public hearings on the subject of Blue Cross and other private health insurance coverage for older Americans. In connection with the preparations for those hearings, it would be very much appreciated if you would forward your responses to the attached questions and requests for material as soon as possible. I have asked Mr. Jay Constantine of the subcommittee staff, to cooperate fully with you in the event that you desire further clarification of the information requested. Thank you for your cooperation. Sincerely yours, PAT MCNAMARA, Chairman, Subcommittee on Health of the Elderly. "CONNECTICUT 65" 1. All literature describing benefits and premiums, including scripts and "tearsheets" used in promotion. 2. Total number of different persons enrolled in program from inception to March 1, 1964; total number of persons accepted for coverage during initial "open" period; total number insured immediately prior to and following each of the two subsequent "open" periods; and total number of persons insured as of March 1, 1964. (Please break down these data to show subtotals indicating numbers of persons in each of your various coverage options.) NOTE. For this and subsequent questions, provide data, to the extent possible, distinguishing between persons age 65 and over and those under age 65. 3. How many of those persons accepted for coverage during your initial "open" period were still insured under the program as of March 1, 1964? 4. What was the average age of the "Connecticut 65" policyholders as of the end of your initial enrollment period? What was the average age as of March 1, 1964? 5. Please provide all data available relating to premiums earned, claims incurred, utilization, etc., for each of the various options and types of coverage. 6. Please provide the details of any and all premium and/or benefit changes made to date in your program. 7. Advise whether any premium and/or benefit changes are anticipated or will be required during the next 2 years. Explain fully. 2. MASSACHUSETTS "65" Senator PAT MCNAMARA, MASSACHUSETTS 65, HEALTH INSURANCE ASSOCIATION, U.S. Senate, Special Committee on Aging, DEAR SENATOR MCNAMARA: Enclosed are the answers to the questions contained in your letter of March 10, 1964: 1. Exhibit I lists the attached items of literature requested. 2. The total number of persons enrolled in the program from inception to March 1964 is shown on the attached exhibit II. 3. The number of persons continuously insured since the original enrollment is not readily available. This information can be secured, if necessary, by a special run of our records. 4. The average age of the Mass 65 policyholder as of the initial enrollment period was 73.5 years. Exhibit III shows our most recent statistics available of the breakdown by ages. 5. Annual statement highlights, exhibit IV. Exhibit V shows the close correlation between the geographical distribution of the aged population and the Mass 65 enrollment. 6. There have been no rate changes since the inception of the program. Several benefit changes, all of which have been liberalizations, have been incorporated in the attached certificates of insurance. 7(a). No changes in the benefits provided by our plan are currently anticipated. 7(b). The initial premium rates assumed that, during the first 2 years, incurred claims would be equal to 85 percent of the premium. At the end of the first policy year the actual experience was, in fact, at this level. After a thorough review of the experience statistics, the executive committee authorized continuance of the initial premium rate for the policy year through December 31, 1964, at which time there will be a further review of accumulated claim experience. The favorable claim experience to date has been achieved through the wholehearted cooperation of the 46 sponsoring companies and the entire medical profession. Sincerely yours, HERBERT S. WOODS, General Manager. EXHIBIT I (a) Sales folder used in connection with first "open" enrollment period. (b) Sales folder used in connection with second and the current "open" enrollment periods. (c) Letter for occupant mailing, influence group, inquiries, and letter to participants. (d) Copies of newspaper advertisements. (e) Agent-broker sales kit. (f) Newsletters to members, agents-brokers, doctors, and hospitals. (g) Copies of radio scripts. (h) Certificates of insurance, plans 1 and 2. Benefit summary chart, plans 1 and 2. Hospital manual. 35-643-64——7 EXHIBIT II (a) The total response during initial enrollment period was 49,893. This represented 8.7 percent of the aged population in Massachusetts and a much larger percentage of the effective market. After eliminating returns permitted under the 10-day free-look provision, duplicate applications, etc., the initial enrollment figure proved to be 43,383. This figure which exceeds by a considerable margin the original expectations is divided between the two plans, as follows: Plan I... Plan II.. Total... 32,728 10,655 43,383 (b) At the time of the April 1963 and March 1964 enrollments there were the following numbers insured: April 1963 (including 941 new enrollees during open enrollment period): Plan I.. 31,269. Plan II... 11,401 Total. 42,670 March 1964 (including 1,305 new enrollees during March enrollment (c) The enrollment activity can be summarized as follows: State premium taxes (estimated). Developmental, promotional, and acquisition costs charged to the 1st policy Percent of premium $6,442, 137 100 5, 475, 532 886 449, 379 7 129,000 2 1960 census, 65 and Mass 65 enrollees MASSACHUSETTS 65 HEALTH INSURANCE ASSOCIATION, Boston, Mass. YOU MUST ACT PROMPTLY TO TAKE ADVANTAGE OF THIS REMARKABLE NEW MAJOR MEDICAL PLAN There are only 10 days left for you to get in on Mass 65, the wonderful new health insurance plan for Massachusetts residents 65 and over. Applications can be accepted only through October 31. If you are 65 or over, or if you are financially responsible for somebody who is, you still have time to apply for this protection if you haven't already done so. As you will recall from the descriptive folder recently mailed to you, Mass 65 pays up to a lifetime maximum of $10,000 for major medical health insurance coverage. It's practically like having a special emergency fund from which you can draw up to $5,000 in any one year to pay the big medical bills that usually result from a major accident or serious illness. Mass 65 begins paying benefits when most basic hospital and surgical plans leave off. It helps pay big bills from your doctor, the hospital, or a convalescent nursing home. And it's easy to take advantage of this plan designed exclusively for Massachusetts residents 65 and over. There's no medical exam required * * * no health questions asked. When you have the protection Mass 65 gives you, you can enjoy new peace of mind *** lessen your worries about the impact of a serious or prolonged illness or crippling injury. Even if your expenses run into thousands of dollars, and this is not at all unusual, you will be helped substantially in meeting the really staggering bills that can be incurred. Mass 65 major medical protection is the type of coverage that people 65 and over have always needed most, yet have often found extremely difficult to obtain. And now it's available, at low cost, for everybody in Massachusetts 65 and over. But you must not delay. The initial enrollment period for Mass 65 ends October 31, no applications can be accepted after that date. So please call or see your agent or broker today *** before time runs out. He'll gladly answer any questions you might have about the plan, and will help you enroll. Sincerely yours, A. M. WILSON, Chairman, Executive Committee. MASSACHUSETTS 65 HEALTH INSURANCE ASSOCIATION, DEAR SIRS: May we ask your cooperation in supporting the new Massachusetts 65 plan? The Will you help us spread the good news about Massachusetts 65-the new major medical health insurance plan for Massachusetts residents 65 and over? support of prominent people like yourself will help us substantially in making this first enrollment period in October successful. You've probably already heard and read a great deal about Massachusetts 65 and the voluntary association of leading insurance companies behind it. The plan has received widespread and enthusiastic coverage and commentary in the press, radio, and TV. This is not surprising, for Massachusetts 65 presents a dramatic answer to the critical need of older people in Massachusetts for low-cost major medical health protection, at a time they can most benefit—when a serious accident or prolonged illness incurs medical and hospital bills that can run into thousands of dollars. As the enclosed folder about Massachusetts 65 points out, expenses of this extent go far beyond the coverage normally provided by basic hospital-surgical insurance. Yet major medical protection is the type of health insurance people 65 and over have often needed most, yet have usually found most difficult to secure without having to take a medical exam. Massachusetts 65 offers benefits that extend up to $10,000 over a person's lifetime *** for medical and surgical bills, for care in a hospital or convalescent home or even in the individual's own home. The plan was designed exclusively for Massachusetts residents 65 and over, and was actually made possible only through passage of a special State law. |