will need to go to the hospital at least once-and two out of every three will need hospital care more than once-during their remaining years. Half of the couples over 65 can expect that both the husband and wife will have at least two hospital stays. This means at least four trips to the hospital for half of the aged couples.

When an older person goes to the hospital he will need to remain there, on the average, about twice as long as a younger person.

This is the problem. Most older people will inevitably need medical care, and this will cost them more than they can afford. As a result, illness forces many of them into poverty-a poverty from which there is no escape. Social security benefits and pensions help meet their needs for food, clothing, shelter, and the necessities. But medical bills of $1,000, $2,000, or up-which so many aged persons must face sooner or later-cannot be met from their limited incomes.

The cost of medical care for prolonged illness can wipe out the life savings of an aged couple of moderate means and can often result in a major financial drain on their children, who usually have families of their own to bring up.

The problem cannot be solved by private insurance alone. The very medical risks older people face make the cost of adequate private insurance prohibitive for the majority.

Nor is economic tragedy resulting from serious illness prevented by public assistance. Public assistance only helps aged people after they become indigent; it does not prevent them from becoming dependent.

PROPOSAL

The President has proposed to Congress the Hospital Insurance Act of 1963, a program to insure older people against the high costs of hospital care and related health services. The program would make it possible for people to build insurance protection in their working years against the high cost of illness in their old age-just as they now build social security protection for themselves and their families against the loss of earnings accompanying old age, disability, or death in the family.

Hospital insurance for the aged through social security, unlike public assistance, would not be based on a means test. On the contrary, its central purpose is to provide insurance protection in old age as a right earned and established during the productive years.

Social security hospital insurance would be provided to all people over 65 who are entitled to social security or railroad retirement benefits. In addition all people now over 65 as well as those becoming 65 in the next few years who do not or will not qualify for social security benefits would be eligible for the health insurance benefits.

The proposed program would provide the following benefits:

(1) Payment of hospital bills. Each person would have a choice of 3 plans

90 days of hospitalization at a cost to the patient of $10 a day for the first 9 days, with a minimum of $20; (or) 45 days of hospital care at no cost to the patient; (or)

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180 days of hospital care, with the patient paying either the national average cost for 22 days or the hospital's customary total charge for the care provided, whichever is less. The national average cost of 212 days of hospital care for the first 2 years of the program (1965-66) has been established as $92.50.

(2) Payment of up to 180 days of skilled nursing home care following discharge from a hospital.

(3) Payment of all costs over and above the first $20 for each outpatient diagnostic study by a hospital.

(4) Payment of all costs for up to 240 visits a year by visiting nurses and other health workers in the patient's own home.

Benefit payments would cover the cost of all services in semiprivate accommodations, drugs, and supplies customarily furnished for the care of patients in a hospital or skilled nursing facility. No payment would be made for the services of personal physicians and private duty nurses, or luxury items furnished at the request of the patient.

Hospital insurance through social security would be financed by an increase of one-fourth of 1 percent in social security contributions for both employees and employers (0.4 of 1 percent for self-employed persons) and an increase in the taxable earnings base from $4,800 to $5,200. Part of the income from the increase in the earnings base will go for higher cash benefits for those earning over $4,800 a year. The cost of the hospital insurance program to the average worker would be about 25 cents a week.

The cost of hospital insurance provided older people not eligible for social security or railroad retirement benefits would be met from the general revenues of the Federal Government. The hospital insurance program and the additional social security contributions would both go into effect January 1, 1965.

WHAT HOSPITAL INSURANCE FOR THE AGED THROUGH SOCIAL SECURITY IS

It is social insurance to help the American people meet the most expensive health care costs they will face in retirement. It is protection built up on a pay-as-you-earn basis-half the cost being met by small payments by the worker when he can best afford it, during his working years and the rest being met by employer contributions. It means protection when people need it most and can least afford itafter the working years are over.

Social security hospital insurance would not be difficult to administer. People over 65 would be given cards much like the cards now provided hospitalization insurance subscribers. And these cards would entitle them to all the benefits of the program. Neither they nor their families would have to prove poverty in order to enter a hospital or nursing home or receive home health care.

Hospitals, skilled nursing facilities, and community health service organizations would bill social security for the reasonable cost of the services they furnished. There would be little difference between the procedures under the proposed program and those already set up and accepted by hospitals in connection with the Blue Cross programs.

Every hospital which is accredited by the joint commission on accreditation of hospitals (a non-Government, professional organiza

tion) would automatically be able to participate, provided only that it had an arrangement for reviewing the utilization of its services and facilities.

Appropriate State agencies would play an important role in determining which nonaccredited hospitals and which skilled nursing facilities would be eligible to participate. These State agencies would also provide consultative services to those institutions to help them qualify.

WHAT HOSPITAL INSURANCE FOR THE AGED THROUGH SOCIAL SECURITY IS NOT

It is not socialized medicine. Nor would it lead to socialized medicine. It is simply a program designed to help older people pay hospital and related health care bills. The Government would not choose the patient's doctor-he would make his own choice of doctor, just as now. The Government would not choose the hospital the older patient used that would be up to the patient and his doctor, just as now. The Government would neither own nor operate the hospitals.

Doctors would not be employees of the Government--they would continue to practice medicine, just as they do now. The only difference would be that neither the doctor nor the patient would have to worry about how the hospital and nursing home bills were to be paid. In short social security hospital insurance would not provide health services. It would simply help pay for them.

The proposed hospital insurance through social security-reinforced by private savings and private health insurance and supplemented where necessary by medical care through public assistance-would become the first line of defense against the high cost of illness in old

age.

Fact Sheet No. 2

EQUAL MEDICAL CARE SERVICES UNDER MEDICAL ASSISTANCE TO THE AGED (MAA) AND OLD-AGE ASSISTANCE (OAA)

BACKGROUND

Medical assistance for the aged is intended to help low-income people over 65 who do not receive old-age assistance but cannot meet the cost of medical care. They usually have sufficient income to meet their regular living expenses. OAA recipients, on the other hand, are generally destitute and have at least an equal need for medical care. However in six States-Tennessee, California, Connecticut, Idaho, Michigan, and South Carolina-OAA recipients receive less medical care than older persons receiving help through MAA. Good public policy seems to require that the most destitute group receive at least as much medical care as the less needy group.

PROPOSAL

As a condition of plan approval for old-age assistance and medical assistance for the aged, each State would be required to make available medical services for OAA recipients at least equal to those available under MAA.

Nothing in the proposal would prevent a State from providing more care under old-age assistance than under medical assistance for the aged.

Fact Sheet No. 3

REMOVAL OF THE 42-DAY LIMITATION ON CARE FOR MENTAL ILLNESS AND TUBERCULOSIS IN GENERAL MEDICAL INSTITUTIONS

BACKGROUND

Historically Federal financial participation was not available for assistance to persons who were inmates of public institutions. Under 1950 legislation Federal financial participation became available for the cost of medical care of old-age assistance recipients includingwith two exceptions-those who were patients in medical institutions. The legislation excluded patients in tuberculosis hospitals and mental hospitals and persons in general medical institutions because of a diagnosis of psychosis and tuberculosis.

With the passage of time there have been marked changes in the accepted methods of medical management of these two disease conditions.

Tuberculosis death rates have declined markedly. Special State and local tuberculosis hospitals are being closed.

The treatment of mental illness has changed substantially from what it was 10 to 12 years ago. The movement is toward early shortterm active therapy in general hospitals. It is reported that there were more psychiatric admissions to general hospitals than there were to special mental institutions in 1961. Over 90 percent of practicing psychiatrists report they use general hospitals in their practice.

The 1960 amendments to the Social Security Act recognized these trends by making provision for up to 42 days of care in a general medical institution for a tuberculous or psychotic patient. The elimination of the present 42-day limitation would be in accord with recommendations of professional medical and welfare experts and would simplify administration.

PROPOSAL

It is proposed that the 42-day limitation in title I and title XVI of the Social Security Act be deleted. This would enable the States to initiate or continue assistance to psychotic or tuberculous patients hospitalized in general medical institutions, without limitation as to the time they may be in such an institution.

Fact Sheet No. 4

INCREASED FUNDS FOR THE CONSTRUCTION OF NURSING HOMES

BACKGROUND

In the vast majority of the States general hospitals far outnumber long-term care facilities. This circumstance should be corrected in order to avoid excessive capital expenditures for the more expensive

general hospital beds, to achieve adequate care and treatment for longterm patients at more reasonable costs, and to release general hospital beds now occupied by patients needing long-term care.

Although it is difficult to establish a precise figure of need additional long-term care facilities are required. State agencies report that over 500,000 additional beds are needed, and this figure is confirmed if the long-term care beds in all States are to be brought up to the level of the long-term care beds in existence in the 5 States with the highest ratio of beds per 1,000 persons over 65 years of age.

Thus far only about 35,000 long-term care beds have been built under the Hill-Burton program. The current annual appropriation authorization of $20 million each for chronic disease hospitals and nursing homes will produce less than 9,000 beds each year. While the number of beds produced outside the program is not known this figure is estimated as approximately 15,000 each year. If this estimate is reasonably correct the overall current addition of approximately 24,000 long-term care beds annually will not reduce the deficit materially. In fact it will accomplish little more than keeping up with the increasing annual need due to the increasing number of elderly persons in the population.

PROPOSAL

It is recommended that the Hill-Burton legislation be amended to increase the annual appropriation ceiling for nursing homes from $20 to $50 million. This amount, when coupled with the $20 million authorized to be appropriated for chronic disease hospitals, would provide a total of $70 million for construction of long-term care facilities. This action would make a significant impact upon the need for an increased number of long-term care beds and would bring about a better balance of these facilities with general hospitals.

Fact Sheet No. 5

CONSUMER PROTECTION-"THERAPEUTIC" DEVICES

BACKGROUND

Each year Americans spend millions of dollars on worthless therapeutic devices and treatment. Much of this money is spent by older people who are the principal targets, and victims, of false promotions. Worthless rheumatism and arthritis remedies alone cost consumers an estimated $250 million a year. Worthless cancer remedies cost them millions more each year.

Any ineffective device that is recommended for a serious disease is potentially harmful. The danger may arise when the purchaser delays getting competent medical treatment while giving the article a try. Delay can be serious-ranging from the unnecessary prolongation of pain or illness to death.

Promoters of quack devices often take advantage of scientific progress by claiming to use a newly discovered principle and by using jargon containing new scientific terminology. This atomic age gave impetus to the promoter of the quack device.