Chapter I. Availability of Kerr-Mills medical assistance for the aged.. 1. Number of States implementing Kerr-Mills_ 3. Responsibility for promoting MAA.. Chapter II. Cost of the medical assistance for the aged program. Total payments by State and Federal share____ Negative aspects of Kerr-Mills expenditures- (a) Use of the Kerr-Mills MAA program as a means of financing benefits for people previously eligible for help under other (b) More favorable Federal matching for MAA has diverted State funds which might otherwise be employed to reduce or eliminate "unmet needs" of the most indigent elderly- (c) The superior ability of the wealthier State to generate match- ing funds has resulted in a marked uneven and inequitable APPENDIXES Appendix A. Efforts of the Department of Health, Education, and Welfare Appendix D. Summary of Kerr-Mills MAA programs and OAA programs, TEXT TABLES III. Number of different recipients who received MAA care, by jurisdic- IV. Medical assistance for the aged: Application and case turnover data from inception of programs through September 1962, by jurisdic- tion_.. V. Medical assistance for the aged: Total payments and Federal share of payments for medical or remedial care, by jurisdiction, calendar year 1962, and from inception of program through December 1962- VI. Medical assistance for the aged (MAA): Vendor payments by State and Federal share, August 1963_-. VII. MAA: Administration costs in relation to total vendor payments, and applicants, by jurisdiction, calendar year 1962. VIII. Limitations on annual income affecting eligibility for MAA, June 1, IX. Ceilings on assests for eligibility for MAA, in addition to homeowner- X. Medical assistance for the aged: Applications received and disposed of and estimated average time lapse from receipt of application to disposal, from inception of program through September 1962, by XI. Old-Age assistance: Percentage distribution of cases opened by reasons for opening, by social security status, 31 States, January- XII. Medical assistance for the aged: Vendor payments for medical care, by jurisdiction, and by type of service, calendar year 1962. XIII. Medical assistance for the aged: Number of different recipients who received one or more types of medical or remedial care, by juris- INTRODUCTION After 3 years of operation, the Kerr-Mills Medical Assistance for the Aged (MAA) program has proved to be at best an ineffective and piecemeal approach to the health problems of the Nation's 18 million older citizens. Since the Kerr-Mills program of Medical Assistance for the Aged took effect on October 1, 1960-3 years ago-the Special Committee on Aging, and its predecessor, the Subcommittee on Problems of the Aged and Aging of the Senate Labor and Public Welfare Committee, have closely observed its operation and have periodically issued reports evaluating the program.1 This report of the Health Subcommittee of the Special Committee on Aging is the third such evaluation of the Kerr-Mills program, and is based upon study and appraisal of all available information. The findings of this report confirm the conclusions of earlier studies that the MAA program did not, and could not by itself, constitute an effective national solution to the pressing and pervasive problems connected with the financing of the hospital and related expenses of the Nation's senior citizens. The findings set forth in "Performance of the States," the 1962 staff report of the Special Committee on Aging, have proved to be still valid. Additional findings and new data have been added. In brief, we find that the Kerr-Mills program of Medical Assistance for the Aged, still suffers from these major defects: 1. After 3 years it is still not a national program, and there is no reason to expect that it will become one in the foreseeable future. Although all 50 State legislatures have met since this program was enacted into law, 3 years ago, only 28 States and 4 other jurisdictions now have the program in operation. 2. Stringent eligibility tests, "lien type" recovery provisions, and responsible relative provisions have severely limited participation in those jurisdictions where the program is in operation. In July of 1963, only 148,000 people received MAA assistance or less than 1 percent of the Nation's older citizens. 3. The duration, levels and types of benefits vary widely from State to State. Except for those four States having comprehensive programs (Hawaii, Massachusetts, New York, and North Dakota) benefits are nominal, nonexistent, or inadequate. 4. Administrative costs of MAA programs remain too high in most jurisdictions. In Tennessee, for example, administrative costs totaled 59 percent, while in four other States they exceeded 25 percent of benefits. 5. The distribution of Federal matching funds under MAA has been grossly disproportionate, with a few wealthy States, best able to finance their phase of the program, getting a lion's share of the funds. Five States, California, New York, Massachusetts, Michigan, and "Performance of the States, 18 Months of Experience With the Medical Assistance for the Aged (Kerr Mills) Program," June 15, 1962. "State Action To Implement Medical Programs for the Aged," June 8, 1961. Pennsylvania, for example, received 88 percent of all Federal MAA funds distributed from the start of the program through December 31, 1962, although those five States have only 32 percent of the Nation's elderly people. New York alone, with 10 percent of the Nation's elderly, received 42 percent of this total. 6. The congressional intent to extend assistance to a new type of "medically indigent" persons through MAA has been frustrated by the practice of several States in transferring nearly 100,000 persons already on other welfare programs, mainly OAA, to the Kerr-Mills program. The States have done this to take advantage of the higher matching grant provisions of Kerr-Mills, saving millions of dollars in State costs, but diverting money meant for other purposes. 7. The "welfare" aspects of the Kerr-Mills MAA program, including cumbersome investigations of eligibility, plus the requirement in most States that resources of an older person must be depleted to a point of near-dependency, have further reduced participation. SUMMARY INTENT OF THE KERR-MILLS MAA LEGISLATION 2 The Kerr-Mills Act has two facets-one representing a relatively minor improvement in the already existing program of aid for people on Old-Age Assistance (OAA), and the other representing a major innovation. The primary feature of Kerr-Mills was the establishment of a new category of public assistance-Medical Assistance for the Aged. This program, popularly known as Kerr-Mills MAA, offered an opportunity for the States to secure substantial Federal grants applicable on a matching basis-toward meeting the medical expenses of older citizens who had previously been ineligible for helpthe "medically indigent" aged. The "medically indigent" aged are those persons who are not on the Old-Age Assistance rolls, but who are unable to cope with the costs of health services. It was the intent of the Congress that the MAA program would provide broad health services to the many aged needing them but unable to afford them even though the individuals were not on welfare. Achievement of such a goal for MAA would require that (1) all States establish MAA programs, (2) the programs include a comprehensive range of medical services consistent with the needs created by the poorer health generally suffered by the aged, (3) the eligibility requirements be realistic in terms of the health expenses and financial resources of the aged, and (4) the assistance be made available without humiliating or degrading our older people. The evidence available after 3 years of Kerr-Mills operation, demonstrates conclusively that the congressional intent has not and will not be realized, with respect to any of these four goals. LIMITED USE OF THE ACT Many States have not implemented the MAA program. As of the end of August 1963, only 28 States and 4 other jurisdictions had MAA plans in operation. Indications are that by the end of 1964, from one-fifth to one-third of the States still will not have MAA plans in operation. In those States which have established MAA plans, implementation is, in many instances, nominal, because of a lack of State funds to finance the type of program that is required. Many States which have established MAA plans still do not meet what they themselves say are the basic needs (not including health needs) of those of their citizens who are on relief. Only 148,000 aged persons received any MAA help in August 1963less than 1 percent of the Nation's elderly. And many thousands of these people had received care or were eligible for care under relief programs existing before enactment of Kerr-Mills. * Since 1950 the Federal Government has assisted the States with funds to be used toward payments to suppliers of medical care for people on relief. The first part of the Kerr-Mills Act simply increased the amount of Federal funds available for that purpose under the program of old-age assistance. |