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(2) Confusion about procedures for claiming reimbursements. This is the most common problem brought to us. My remarks on the previous point apply equally to this subject, and I shall not repeat them. (3) Delay in receiving reimbursement. This is a common and very understandable complaint. The average retired person is not financially able to wait several months or more to be reimbursed. The situation is frequently aggravated because usually any benefit under complementary coverage will not be processed until after the medicare payment has been made.
(4) Overcharges. We have received some complaints by patients who paid a physician's fee and were reimbursed on a lesser scale because medicare considered the fee excessive. At times the overcharge has been in excess of $100, which obviously creates a real problem for the older person. We shall not attempt to say how widespread this problem is. Such data are undoubtedly available to this committee. Aside from overcharges as such, however, there is no doubt that there has been a general increase in medical fees since medicare came into effect. The majority of older people we talk to report this. In a number of instances, for example, fees for office calls have risen by 100 percent or more.
(5) Refusal to accept assignment. The refusal of many physicians to assign their bills to medicare is without doubt the most critical problem. Indeed, one might say that this is at the root of the others I have talked about.
We had very few problems brought to us where the physician accepted assignment. Consider how things are changed when the doctor assigns his bills. If the patient had a question about benefits it would probably have been cleared up in the doctor's office. The patient would have no need to claim reimbursement. While this is an exceedingly simple procedure for a doctor's secretary it is overwhelming for many older persons. The elderly patient would not have to wait for reimbursement. It is true that the physician would have the wait, but he is in much better position to do so than the retiree. Besides, aside from medicare, doctors are accustomed to delays in payment, whether from an individual patient or an insurance company. The patient would have no anxiety about overcharge. Finally, the patient would be spared having to lay out the doctor's fee.
DIRECT PAYMENT PROBLEMS
We have had innumerable cases in which the doctor's demand for direct payment caused hardship to the elderly patient. A number of examples have been submitted to you. We could have multiplied these manifold.
Testifying in behalf of our union, on March 22, 1967, before the Ways and Means Committee of the House of Representatives, President Walter P. Reuther called for an amendment which would limit payments by medicare only to those cases in which the physician accepts assignment. He made a number of other important proposals as well. Among these are:
Eliminate coinsurance and deductible requirements, extend hospital coverage to 365 days, add coverage for prescription drugs used
outside a hospital, liberalize requirements and extent of coverage for the extended-care benefit, and extend medicare coverage to all OASDHI beneficiaries regardless of age.
Thank you, Mr. Chairman.
Senator SMATHERS. Thank you, Mr. Wallick.
Mr. Hutton, did you want to add something?
Mr. HUTTON. I think perhaps I will just submit the statements. One, Senator, is from your own State of Florida, Mr. Cary M. Williams, who is with Suncoast Progress, Inc., in St. Petersburg, Fla. He is a distinguished former Social Security official now working with the Office of Economic Opportunity program.
Senator SMATHERS. We had him scheduled here as a witness. We were going to put that in the record and we were also going to put in the statement of Mr. Rodney M. Coe, Ph. D., Washington University, St. Louis, Mo.
Are those the two statements you had reference to?
Mr. HUTTON. Those are the two statements.
Senator SMATHERS. At this point we will again state that these witnesses were unavoidably detained, unable to appear. Without objection we are going to make their statements a part of the record; that is, Mr. Cary M. Williams and Mr. Rodney M. Coe who is the executive director of the Medical Care Research Center, St. Louis, Mo.
(The statements referred to follow :)
STATEMENT OF CARY M. WILLIAMS, SUNCOAST PROGRESS, INC., ST. PETERSBURG, FLA.
Medicare approaches the end of its first year of operation, a year marked by a wonderful improvement in the health care of our elderly citizens, and a year plagued by the usual "bugs" common to the initial stages of any program so farreaching. Many of us associated with the administration of the Social Security program in its fledgling days well remember the difficulties encountered, the annual appraisals, and the many, many amendments necessary to keep abreast of the times. So will it be with Medicare.
I speak for the retirees of Pinellas County, Florida; of their appreciation for the blessings of the program, and of their frustrations over its shortcomings. According to the 1960 census, 31.5 percent of the population are over 65; and 58.7 percent of these folks have incomes of under $2000, 22.2 percent have incomes of under $1000. The majority have no family responsible for their well-being, and are far removed from their lifetime family doctor.
Our findings during the past year, in the course of personal interviews by our C.A.P. neighborhood workers, and by a recent "write-in" project, reveal that many of our elderly are unable to take advantage of the program because of their inability to finance the pre-payments required. Very few, if any, of the doctors in our area are willing to accept assignments; and patients are compelled to borrow the amount and to pay interest, often exorbitant, until their claim is settled. The position of the Florida Medical Association is that the patient should be allowed to send in his physician's statement and be reimbursed on that basis, in order that he might pay the physician without undue economic hardship.
The removal of the deductibles and full payment of all reasonable charges would enable many more of our elders to take advantage of the program. And, while this is not on the agenda of this hearing, let us consider the fact that a substantial raise in the Social Security benefits for beneficiaries in the lower brackets could make better medical care possible.
While some progress has been made, the "pipe-line" from the intermediaries to the patients still seems to be clogged. Medicare patients are bewildered by state ments from hospitals listing unexplained and often duplicate charges, and by statements from the intermediaries. This adds to the worries and tensions and has an adverse therapeutic effect, hindering full recovery. The Social Security District Offices, in spite of the tremendous work load, have done an outstanding
job in explaining the provisions of the program and in the interpretation of various statements received by the patient.
As the Medicare program gains momentum, a serious shortage of para-medical personnel is appearing. This includes Nurses, Licensed Practical Nurses, Nurse's Aides, Physio-therapists, Laboratory Technicians, and more and more nurses for our nursing homes. This condition might be alleviated by stepping up the various programs administered by H.E.W. and the Dept of Labor. I refer to the M.D.T.A. training for Health Service Occupations, Public Health Training for Professional Education and Training, Nurse Training, Health Profession Educational Assistance, Student Loans, Scholarships, and Improvement Grants, Home Health Aides and other non-professional health service workers. As you are well aware, these programs depend on appropriations.
Post-hospital extended care and home health care play an important part in the road to recovery, and further implementation of these services would speed recovery of the patient and help to relieve crowded hospital conditions. In St. Petersburg, 4000 home health visits per month are made by the Visiting Nurses Association. Many people in Pinellas County either live alone or they live with a spouse who is almost as equally handicapped as the patient. A post-hospital cataract patient or one with a fractured hip needs assistance with personal care by the Home Health Aide. He also needs someone to do his grocery shopping, cook his meals and do personal laundry. These latter services are being excluded from the Home Health Aide Program until definite guidelines are set up as to what is reimbursable; i.e., "incidental household services which are essential to the patient's health care at home and necessary to prevent or postpone institutionalization." We could utilize the service of available low-income seniors for the more domestic of these home aid services. This would not only relieve the semiprofessional, but would add to the meager income of the aide.
One of the most serious of the deterrents to the success of the program in our area is the high cost of prescriptions. These folks just can't afford to pay even $10 or $15 a month for medication. I quote from one of the letters recently received, "for a whole year my husband had a doctor who constantly prescribed pills. Last November the pills were $12, which we could not afford, so we did not get them. He died February 16, 1967." As a result, many depend on patent medicines for relief. He goes to his favorite druggist and asks what he would suggest for his particular ailment. It is common practice in this area for a drug clerk to diagnose the ailment and prescribe the medication. This practice negates the visit to the doctor. By all means, the cost of prescription drugs should be covered by Medicare.
In our area there has been much discussion about the cost of medicines. The question arises, is it cheaper to buy the generic name or buy the trade name. Many physicians state that one can buy the product by the generic name and pay as much or more than he would pay for the same medication under the trade name. The true value of the product under the generic name can be only as good as the integrity of the firm producing and marketing it. In some cases absolutely worthless! Only the product of a quality-oriented firm can be relied upon to produce the desired, consistent physiological effects.
To sum up this all-too-brief presentation, Medicare can be made more effective if we can:
Eliminate the deductibles
Simplify the paper work
Furnish more in the way of home aid
Pay for prescriptions
Bring Social Security disability beneficiaries into the program
Train more physicians and para-medics
We are already experiencing the beneficial results of this wonderful humanitarian program in St. Petersburg, and our senior citizens petition you to make these suggested additions that will make it possible for full participation.
STATEMENT OF RODNEY M. COE, PH. D., WASHINGTON UNIVERSITY,
The purposes of this statement are to present some preliminary results and to describe the next steps of a research project to evaluate the effects of Medicare on the provision and utilization of community health resources. This project is
sponsored by the Midwest Council for Social Research in Aging and its host institution, Institute for Community Studies in Kansas City, Missouri (see Attachment A for a statement about the Midwest Council) and financially supported by U.S. Public Health Service Grant Number CD 00244.
DESCRIPTION OF THE RESEARCH PROJECT
With Medicare as its central focus, this research project, entitled "Changing Community Patterns-Health Care for Aging," is being conducted in two phases. The first is an interview survey of people aged sixty or over in a random sample of 2622 households in five midwestern communities. The second is an analysis of the ways in which these same five communities organize their health and medical care services for care of the aged. To measure the changes which take place, each of the phases is to be conducted twice; once when Medicare started and again in 1968.
The five communities were selected as "types" of cities varying by size and availability of health care resources. The metropolitan area chosen is Kansas City, Missouri which, like all large cities, has the full range of community health resources. Two cities of about 100,000 population which are alike in their essential characteristics, but differ in amount of health resources were selected These are Cedar Rapids, Iowa and Springfield, Missouri. Finally, two smaller cities of about 25,000 population which represent non-urban, medical trade centers were also chosen. These were Great Bend, Kansas and Waupaca, Wisconsin.
The household interview phase is designed to collect information concerning (1) attitudes of the older population toward the Medicare program, physicians, hospitals and nursing homes; (2) perception and understanding of the meaning of disease symptoms common among older people; (3) experiences with the Medicare program in terms of utilization of health resources and the costs of services received. The community analysis phase is designed to collect information about the ways in which organizations and groups in the selected communities organize themselves and coordinate their efforts to provide health and medical care services for the aged. The main targets for study in these communities are (1) service facilities such as hospitals, nursing homes and similar institutions; (2) service organizations, both public and private, such as welfare departments, Senior Citizens clubs, etc., but especially physicians in the local medical societies; and (3) coordinating organizations such as health and welfare councils or similar voluntary agencies. At the present time, the first household survey has been completed. The community analysis phase is not yet completed and no data are now available.
PRELIMINARY RESULTS OF THE HOUSEHOLD SURVEY
The first household survey was a very successful operation which yielded a large amount of data. I will attempt to summarize some results selected because I believe them to be most relevant to the purposes of this committee. A further elaboration of some of these results may be found in the attachments submitted with this statement (see Attachments B, C and D). The tentative findings presented here relate to (1) attitudes toward Medicare as a program; (2) attitudes toward medical care resources; (3) utilization of these resources before and after July 1, 1966; and (4) the costs of care received.
Attitudes toward medicare as a program
The responses to a question tapping general attitude toward Medicare as a program were overwhelmingly positive. The proportion of respondents in the different communities favoring Medicare ranged from two-thirds to nearly threefourths. Actually, what is more impressive is the small proportion who did not approve of Medicare. These percentages ranged from 7% to 10%. The balance of the respondents, mostly those under age 65, were unable to clearly state their attitude.
The major source of this positive attitude lies in two, related opinions. More than 80% of all respondents agreed that "Medicare will improve the health care given to older people" and "most older people need Medicare." These respondents were much less certain that Medicare should be extended to people under age sixty-five (about 40% agreement) or that Medicare would lead to "socialized medicine" (about 30% agreement).
Attitudes toward health care resources
A series of questions were asked about three types of health resources; physicians, hospitals and nursing homes. In general, it may be said that most of these respondents hold positive attitudes toward physicians although respondents in the smaller communities are more favorable toward physicians than respondents in the larger communities. For the most part, they view physicians as being competent and exerting his best efforts regardless of their ability to pay for his services.
These respondents hold equally strong, positive attitudes toward hospitals at least in terms of quality of care. That is, respondents tended to agree that the hospital was the appropriate place for medical treatment and that a high quality of care could be obtained there. However, less than half the respondents agreed that hospital costs were appropriate for the care received and more than one-third flatly disagreed that hospital costs were fair.
Attitudes toward nursing homes were much less positive and, in fact, suggest that these respondents are quite suspicious about the quality of care received and about the cost of care rendered. The only consistently favorable response to nursing homes was that it was chosen over the home of a relative for incapacitated older people. Since these respondents have had considerable contact with physicians and hospitals, but virtually none with nursing homes. It is apparent that their expressed attitudes are based on experiences with the former two, but on a generally poor national reputation for the latter.
Utilization of health facilities
Three measures were used to estimate the utilization rates of hospitals, nursing homes and physicians. The measures were number of hospital admissions per 100 respondents per month; number of days of hospital care per respondent per month; and number of physician contacts per 100 patients per month. These measures were taken for the periods January 1 to June 30, 1966 and July 1 to October 31, 1966. Because less than 2% of the respondents had been in a nursing home, these data were not analyzed.
The tentative conclusions which may be drawn from comparison of these measures of utilization before and after July 1, 1966 when Medicare began are: (1) no significant increase in number of hospital admissions,
(2) a generally small increase in the number of days of hospital care received,
(3) a significant increase in the number of physician contacts. It seems doubtful, at this point, however, that much of the observed increase in utilization can be directly attributed to Medicare primarily because the percentage increase was as great for respondents under age 65 as for those over age sixty-five. Moreover, the total volume of utilization on these measures roughly approximates "normal" utilization as measured by other surveys, principally the National Health Survey. Since the volume remains relatively low, it is not surprising that most facilities, especially hospitals, do not report increases as large as expected prior to the start of Medicare. Costs of services received
As in the case of utilization, respondents were asked a series of questions about their costs of medical care before and after Medicare. The questions related to whether they had had any medical bills not covered by some form of insurance, how much these were, who paid them and, as a result, did they put off any other purchases because of uninsured costs of medical care.
The tentative findings here indicate that one-half or more of the respondents in each community had had uninsured medical care costs during the period January 1 to June 30, 1966 and a sizable proportion had them after July 1. In every case, however, there was a decline in the percentage of respondents who said they had uninsured expenses after Medicare started. The decline was greater in the large cities (about 6%) than in the smaller ones (about 3%).
Despite the fact that the magnitude of the decline in uninsured costs was very small, it apparently benefitted most those respondents with the largest unpaid bills. The percentage of respondents owing $150 or more for uninsured bills showed the greatest decrease after July 1, 1966 while those owing $30 or less were not benefitted at all.
The source of payment for these uninsured bills was overwhelmingly the individual. Nine of every ten respondents, both before and after Medicare started. paid these costs out of their own pockets. The remainder was paid from other sources such as relatives, welfare agencies, etc., or it was not paid at all.