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Disability days per person per year for persons 65 years and older by family

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Disability days per person per year for persons 65 years and older by major

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Prevalence of selected chronic conditions among persons 45 years and older by age

Such facts concerning the health status of the aged, and there are many more to be gleaned from the National Health Survey, are enough to demonstrate the special health problems of this part of the population. The survey also shows the relationship between family income and chronic illness, by age-with the lowest income aged experiencing the greatest proportions of chronic conditions. As one concrete example, among those individuals aged 75 and over and with a family income of less than $2,000, the proportion with no chronic conditions is 13 percent, as compared with 20 percent for the 75-plus population with a family income of more than $7,000.

The privately financed Health Information Foundation has, since the publication of this subcommittee's first report, released its findings based on a 1957-58 study conducted by the National Opinion Research Center. The study included data on medical expenses of age groups and indicates the greater burden of illness among the oldest group. It was found that:

1. On a per capita basis, the total medical expenses of the aged were 88 percent greater than for the general population, $177 versus $94. These figures exclude payments for health insurance premiums, but include amounts paid out as benefits; they exclude payments for all institutionalized persons, as well as for nearly all patients in mental

and tuberculosis hospitals. In further evaluating these figures, the following points should be borne in mind:

(a) The figures do not include expenditures in the survey time period (1 year) by individuals living alone and not surviving to be interviewed.

(b) They exclude the value of free services, such as from physicians, philanthropic organizations, and public funds.

(c) The per capita figures tend to minimize the severity of the costs of illness on a family basis.

2. On the basis of these considerations, and through estimates of the overall increases in medical care expenses since 1957-58, the Division of Program Research of the Social Security Administration has arrived at a 1960 per capita medical expense for the agedexcluding care in mental and tuberculosis hospitals of approximately $265, of which 82 percent is derived from private sources. On the basis of such estimates, the total medical expenditures for the aged in 1959-60 (again, exclusive of mental and tuberculosis hospital expenditures) was, therefore, about $4.2 billion.2

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Percent of cases medically attended under care and not under care and never medically attended for selected chronic conditions among persons 65 years and older

2"Expenditures for Medical Care for Persons Aged 65 and Over," Research and Statistics note No. 15-1960, July 21.

ROLE OF CURRENT HEALTH INSURANCE PROGRAMS

Although it may be a truism to state that no individual can predict the occurence or kind of illness and the expenses involved, for the duration of his life, it is possible to make predictions, or estimates, for large groups of men and women. The widespread utilization of health insurance programs is ample demonstration of this principle. Prepaid health care has thus become a major thread in the health fabric of the American population. It is certainly generally agreed that a system of prepaid health insurance is a much more rational and effective means of meeting the expenses of health care than the older one of "scraping up" money only at the time of an illness, or thereafter. Not only is the prepayment system, through insurance, more rational: it also is conducive toward improvements in health status per se because it substantially reduces the tendency to delay or avoid medical attention and necessary hospitalization. Payments for health care on the individual level are not like costs for food, clothing, housing, etc., the needs for which are on a level basis, month by month. The individual cannot predict his own health needs.

The crucial point for the subcommittee therefore becomes: what proportion of the aged have adequate insurance coverage and what is the best method of financing such insurance for this segment of the population?

Extent of current coverage. The subcommittee has attempted to obtain from private insurance programs reliable information about the numbers of aged with some degree of protection against the costs of hospitalization and surgery. Precise information was difficult to obtain.

This shortcoming, however, has been remedied in a major degree by the December 1960 report of the National Health Survey. During July-December 1959, the survey interviewed 19,000 households with 62,000 persons, including well over 5,000 persons aged 65 and older, concerning extent of health insurance coverage. The overall findings were as follows:

TABLE 1.-Percent of aged persons with hospital, surgical, and doctor visit insurance, July-December 1959

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Source: "Health Statistics" from U.S. National Health Survey, series B, No. 26, December 1960.

Thus, while two-thirds of the general population are protected against all or some of the costs of hospitalization through insurance, less than one-half of the aged are even partially protected. The relative protection against costs of surgery and of doctor visits is even less favorable. As the above table reveals, less than one-third of the population aged 75 and over is covered by any degree of hospital insurance, less than one-fourth by surgical insurance. In evaluating

the extent of coverage among these "older" persons, it should be emphasized that they number about 5.5 million individuals, with approximately three-fifths of them women. These numbers will increase over the years, and the proportion of women (whose incomes are definitely lower) in this age group will likewise magnify.

Perhaps more crucial is the percentage of insurance coverage among only the retired aged, as compared with the general population, for it is with retirement that the health care problem is aggravated by substantial reduction in financial resources. Among the aged not usually working, the percentages with insurance coverage are as follows:

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TABLE 2.-Percent of "retired" aged persons with hospital, surgical, and doctor visit insurance, July-December 1959

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These figures take on greater significance when it is remembered that the retired segment of the aged population makes up more than 80 percent of all persons 65 and older. This is the group with which the subcommittee is most concerned. The major fact, then, is that as of 1959, slightly more than two-fifths of the noninstitutionalized retired aged held any kind of hospital insurance coverage, less than one-third had surgical insurance, and about one-twelfth had doctor visit insurance.

Using these data, then, we can estimate that, as of 1960, approximately 7.5 million retired aged Americans were without any hospital insurance protection; 8.7 million without surgical insurance, and nearly 12 million without doctor visit insurance.

Adequacy of protection.-Approximately 7 million persons aged 65 and older have some hospital insurance, and approximately 5.5 million have some surgical insurance. How adequate is the protection?

A review of the evidence to determine adequacy leads the subcommittee to the conclusion that even for those who do have private insurance coverage, such protection is far from satisfactory.

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1. For example, the 1957 OASI beneficiary survey revealed that among those insured couples who were hospitalized, more than 7 out of every 10 had less than one-half of their total medical costs met by any insurance. Only 27 percent had more than half of their costs met by insurance. For all beneficiary couples (including the nonhospitalized), insurance covered part or all of the total costs for only 14 percent. For those couples with at least one hospitalization episode in the survey year, the median costs were about $700.

This survey, limited to OASDI beneficiaries, and thus to persons in better financial conditions than most other retired individuals, 2. See the chapter in this report on income, which reports, for example, a median income of "retired" aged heads of families only 47.3 percent of the income of those employed year-round, full time.

Reported in "Hospitalization Insurance for OASDI Beneficiaries," report submitted to Committee on Ways and Means by Secretary of Health, Education, and Welfare Apr. 3, 1959.

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