INTRODUCTORY NOTE This comparison of the major health insurance proposals for older persons which have been introduced thus far in the 87th Congress has been prepared by the Staff of the Special Committee on Aging. The basic provisions of the various bills have been charted without editorial comment. However, because I believe it is essential to safeguard the user against misinterpretation, I am prefacing the chart with a few words of explanation. Some of these proposals, although financed through the Federal Government, offer the beneficiary the option of choosing among private health insurance plans indeed one proposal relates exclusively to private insurance. The fact that a legislative proposal spells out a package of health benefits to be obtained through private insurance does not mean that such benefits are actually available, nor does it mean that the benefits specified could be made. available for anything like the premium amount provided through the proposed plan. Language that says the private plan must have an "actuarial value" equal to that of the Government plan does not mean that the individual would pay no more in premiums than the cost of the Government plan. It is obvious that commercial insurers cannot offer equivalent benefits at a lower cost than that of a Government plan even if they were to forego all profits a very unlikely possibility. Yet so long as an option is provided, the sales pressure which insurance companies could bring to bear on those older people who constitute the better risks might be such that many individuals unskilled in the complex art of understanding insurance policies would contract for coverage costing more than equal protection under the Government plan. By the same token, such an approach would also tend to leave the poorer, more expensive risks to burden the Government plan. It is essential that a social insurance health plan be based on community rating, as Blue Cross and Blue Shield were supposed to be on their initiation. The entire group of older people to be insured, the good and the bad risks together, must be in the one plan if it is to be soundly financed. Moreover, option provisions would mean that social insurance contributions would be used to pay profits to private insurance companies, thus spending dollars which buy no protection. Terms also can be confusing. For example, "guaranteed renewable" means only that premiums or benefits may not be modified for an individual, but is no guarantee against rising premiums for all those covered by the policy. Options for private insurance must be carefully scrutinized with respect to such provisions as lifetime maximums and exclusions of preexisting conditions. Another such example is the use of the phrase "free choice" to characterize proposals offering options for private insurance. Such options invariably result in higher costs, or less protection for the same costs. "Free choice" when it means the right to choose one's own doctor is meaningful and most important. "Free choice" when it means merely the right to choose among insurance carriers offering less protection or charging higher premiums than the Government plan lacks all meaning and represents only a misleading slogan. Three basic questions should be kept in mind in assessing these various proposals. Is not our Social Security system the one mechanism through which people can provide for themselves, on a group basis and at a price they can afford to pay, hospital insurance for their later years which is paid up prior to old age? Is not this the method through which our older population can be relieved of the intolerable burden of rising and unpredictable health costs or of ever higher insurance premiums against these costs? Will not the utilization of this social insurance method to help meet the necessarily higher health costs of older people provide both stimulus and opportunity for private profit and nonprofit insurance plans to devise more acceptable and less expensive programs to meet the health costs not covered by the legislation or of younger groups in the population? PAT MCNAMARA, Chairman, Special Committee on Aging. (1) |