TABLE 14.-Incidence of acute conditions among persons 45 years and older: United States, July 1957 to June 1958 and July 1958 to June 1959 NOTE. Since the estimates shown in this table are based on single years of data collection, the standard errors are 1.25 times the standard errors shown in app. I. TABLE 15.-Persons injured by class of accident for persons 45 years and older: United States, July 1957 to June 1959 Source: U.S. Department of Health, Education, and Welfare, series C, No. 4, September 1960, National Health Survey. Mr. CURTIS. Now, the other thing that bears on cost, which is a dramatic improvement and we have just begun to touch the surface, I believe, in the use of facilities less than the hospital, convalescent homes, nursing homes, home care, and so forth. Formerly, we did not have these facilities to speak of at all. Yet the cost, and I would like to know this-this is one of the questions-the cost of using the hospital in relation to the cost of the lesser facilities. Indeed, we might even add in here clinics, because today, as I understand it, a lot is done in clinics that used to require a hospital stay, if one can make a distinction between a clinic and a hospital. Dr. WILSON. You are using clinic as outpatient facility? Mr. CURTIS. You call that "outpatient facility"? Dr. WILSON. Yes. Mr. CURTIS. What I am seeking, of course, is the difference in cost and then to ask the basic question which is, how much have we been able to shift from the higher cost institutions to the lesser cost. An individual with a compound fracture would require hospitalization, say, 20 years ago. Perhaps that kind of thing can be treated in the hospital or maybe only 1 day in the hospital and 4 or 5 days in a convalescent home, which is of lesser cost. Do you see what I am driving at? Dr. WILSON. We do a lot of that with broken hips. Mr. CURTIS. You see the point I am driving at? To get at the general cost in this thing as it affects the individual citizen, because so much attention has been directed to the increased cost without any reference to hospitals. What we are really seeking is what is the impact on a person who has an illness or accident, so far as costs are concerned, and the development of these lesser facilities of course will ease this cost. One reason I might say I sponsored and I can almost say originated the concept of FHA loans to private nursing homes is because I did feel we badly needed these facilities and if they were available we could ease a great deal of burden on the hospitals and also ease the tremendous cost burden on the individual citizen. Likewise, in relation to home care, the visiting nurse technique, and the clinics. But these data that bear on this and the progress in this area as it relates to cost have not been gathered together that I have seen. I have tried to gather bits together as best I can in my own way. Now, we have you as a witness here and perhaps you can gather, help this committee to gather this kind of data. Dr. WILSON. We thoroughly agree with your concept. All of us are working on it. It is extremely difficult to get figures that will give you, figuratively speaking, the exact picture you want. We will make an effort to get it. Mr. CURTIS. There is data. I know it is difficult. But there is actually quite a bit of data. That is what I have asked the Department of Health, Education, and Welfare. If there is one function that I am certainly in accord with that the Federal Government has and particularly HEW, it is to gather together this kind of information and data in our society and to have it available so that it can be interpreted. To me it is tragic that the Department of Health, Education, and Welfare has not been able in this one area to gather this kind of information so that we could deal with these problems more intelligently. The other point, and this perhaps you are not able to help us on, is the incidence of accident and sickness for which a person may require hospitalization. I remember when I was a kid they took me to a hospital for a tonsillectomy. Maybe that is done today. I understand a lot of things that used to be done in the hospitals no longer requires hospitalization because we have advanced these intermediate skills. Anyway, you can shed light on that trend. Now in the area as it relates to cost, a problem that I have become deeply concerned about is what I call "overinsurance." So much attention has been directed to the lack of helath insurance but I have studied this enough to know that there are instances of people who are covered for the same illness or accident, not once but twice, in group insurance programs, and so forth. I found out I was covered in three different programs. Το my knowledge, people actually make money out of being sick. And it is perfectly all right to submit a hopsital bill not to just the one insurance company but to collect two and three times for it. They say, "after all, I paid for it." There is perhaps some rationale to it. But the point is the extent to which that is being done is raising the cost of health insurance premiums for everyone and also it gives a tremendous incentive for overutilization of our facilities when a person really would not have to go perhaps to a hospital. Now, there has been very little work done at the State level to protect against this kind of overinsurance. In fact, I have understood that some States actually have been resisting the attempts of insurance companies to pro rate when they find themselves both on the same policy. It is a more difficult field to police or administer than, say, fire insurance, where you have a home insured for $15,000 with one company and another $15,000 with another, because those are large sums. The hospital bills are usually in the hundreds of dollars, not a thousand. In other fields, home insurance, we moved in on fairly early and had laws on public policy to prohibit overinsurance because it was an incentive for arson, or overinsurance beyond insurable risks in the field of life which, I hate to say it, proved to be an incentive for murder. There is none of this glaring antisocial policy, but with this great problem that we have in the cost of health care, I think it becomes important for hospital associations and all concerned with health costs to realize that this has built up this phenomenon of overinsurance. To the extent that you can, supply for the record information that you have on what is being done in this area to correct against overinsurance or is it your judgment that it is not as grave a problem as I have suggested? If you want to comment now, of course, do so, but I am trying to make the record here and provide the things in the record. I do not wish to shut off comment now but I thought it would be best to pose these for you to supply for the record. Dr. WILSON. I think your comments are excellent. We would like to have an opportunity to give this in detail. Mr. CURTIS. I have been trying to urge the health insurance people, particularly the Blue Cross, to recognize the advantages of the $50 or $25 or $100 deductible policy as it relates to overutilization of facilities which bears again on the cost of premiums and everything else. There has been a reluctance on the part of Blue Cross people to do that. They want the first dollar. I say: Look, it is not saying to the people that they can't have the first dollar of insurance. You give them all kinds of plans just as we have insurance on personal property. You can have a first dollar policy if you want but, of course, the premium is a great deal higher than if you take out a $50 deductible. It is simply to provide a choice. Then those who prefer to take care of themselves so far as insurance is concerned and agree to bear the first $25, the first $50, the premium, both from the standpoint of administration as well as other costs, can be considerably less. 27-166-64-pt. 1——27 So you offer them a Blue Cross policy alternatively. If you want the first dollar, OK. Now, for the record, what developments are there in this field and what is your position on that? Dr. WILSON. Do you want us to talk on that now or submit some information for the record? Mr. CURTIS. That is all for the record. This record will become permanent. I will read it and others will read it. These data will be available to the committee to try to gain a better understanding. Mr. WILLIAMSON. I will say that Blue Cross in part has been urged to adopt this position by hospitals. Mr. CURTIS. Have you really? Well, good for you. I know it is a problem. They have their points to site, too. This all bears on this very important angle of cost. (The information referred to follows:) COMPARISON OF HOSPITAL AND NURSING HOME COSTS There are no comprehensive data available by which the per diem cost of care in nursing homes can be compared with the cost of care in hospitals. Indeed, the cost of nursing home care varies greatly from place to place depending upon the cost of the building and the quality of service. Spot inquiries indicate, however, that on the average, the per diem cost of care in nursing homes will range from one-third to one-half the cost of care in hospitals. USE OF OUTPATIENT CLINICS, NURSING HOMES, AND HOME CARE PROGRAMS There has been a great increase in the use of outpatient clinics, nursing home care, and home care programs over the past several years at great savings over the use of hospital facilities. In 1949 there were 47,721,353 outpatient visits to hospitals in the United States. In 1962 the number of outpatient visits reported was 99,382,469. The growth in the number of nursing home beds over the past few years has also been spectacular as shown in the following table. (See table on nursing homes.) In addition to the greatly increased use of outpatient clinics and nursing homes, home care programs are becoming more numerous. The following two tables show the number of days in a home care program after hospitalization and the age and sex distribution of a selected group of cases in New York. (See tables titled "Hospital, Home Care and Combined Days by Hospital Stay Categories, First 500 Completed Home Care Cases" and "First 1,000 Home Care Patients, Age-Sex Distribution, Percentage.") National estimates of the number of nursing homes and related facilities, by type of care provided, United States and territories, 1954 and 1961 1 Facilities classified as "sheltered care" in the 1954 inventory are included in the "residential care without skilled nursing" category in the 1961 inventory. COMBINED USE OF HOSPITAL AND HOME CARE Combined use of hospital and home care shortens the inhospital period of care but increases the overall duration of service. This is important to the patients because they are seriously ill, as shown by diagnoses and implicit in age distribution. For an overall average of 83.4 days, these patients were under continuous care with opportunity for preventive and rehabilitative as well as curative services. The average hospital stay was 23.8 days and the home care stay, 59.6 days. The average hospital stay for these patients cannot be compared to the generally cited overall "average hospital stays," since maternity as well as tonsillectomy and other 2- or 3-day stays for minor ailments are included in the computations and the home care population does not include such patients. 1 TO 21 DAYS In the first 1,000 home care cases, there were 559 female and 441 male patients. The median age was 58.8 years. A census conducted on May 10, 1961, by AHS and the 229 local, short-term hospitals showed that, excluding maternity and newborn, there were 25,285 patients in voluntary hospitals, of whom 52.9 percent were female and 47.1 percent male. The median age was 51.9 years. |