The Social Security Bulletin is for sale by the Superintendent of Documents, U. S. Government Printing Office, Washington, D. C. 20402. Price: $2.75 a year in the United States, Canada, and Mexico; $3.50 in all other countries; single copies, 25 cents. Price of the 1955 Supplement, 40 cents; 1956 Supplement, 45 cents; 1957 Supplement, 50 cents; 1959 Supplement, 55 cents; 1960 Supplement, 60 cents; 1962 Supplement, 60 cents; 1963 Supplement, 60 cents; 1964 Supplement, 50 cents. Use of funds for printing this publication has been approved by the Director of the Bureau of the Budget (April 7, 1964). U. S. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE SOCIAL SECURITY ADMINISTRATION OFFICE OF RESEARCH AND STATISTICS Advisory Committee on Research Development E. CARY BROWN, JACOB FELDMAN JAMES MORGAN, EUGENE SMOLENSKY, FREDERICK F. STEPHAN DEPOSITED BY THE UNITED STATES C Social Security in Review PROGRAM OPERATIONS OASDI Benefits September's increase of 62,000 in the number of persons receiving old-age, survivors, and disability insurance monthly benefits under the OASDHI program brought the total to 21.9 million. At the end of September, retired workers and their dependents numbered 14.7 million and made up 67 percent of all beneficiaries. Persons receiving survivor monthly benefits represented 24 percent (5.3 million) of all beneficiaries, and disabled workers and their dependents (1.9 million) accounted for the remaining 9 percent. The monthly benefit rate of $1,598 million at the end of September was almost $6 million higher than it had been at the end of August. During September, almost 263,000 monthly enefits were awarded-about 6,000 more than in August. The number of monthly benefits awarded Juring the first 9 months of the year (3.2 million) exceeded by 927,000 the record number awarded 'n January-September 1962. The record total was reached mainly because of (1) the estimated half million awards to persons aged 65 and over who had not yet retired but who filed applications to establish entitlement to OASDI benefits and thus qualify for hospital insurance benefits and (2) the 594,000 awards to persons who qualified for benefits under other provisions of the 1965 amendments. New highs were set for awards of old-age benefits (1,394,000), child's benefits (829,000), and widow's or widower's benefits (319,000) made during the first 9 months of a year. During January-September, 807,000 deceased workers were represented in the 865,000 lump-sum eath payment awards, more than in the first 9 onths of any other year. The average lump-sum nount per worker was $223.73, a new high. Health Insurance Benefits In September about 400,000 hospital admission notices under the new health insurance program for the aged were received by the Social Security Administration, bringing the total received by the end of September to 14 million. About 55,000 "start of care" notices of home health services following hospitalizations had also been received by the end of that month. Under the medical insurance program covering physician and other medical services intermediaries had submitted almost 900,000 queries in the program's first 3 months. These queries represent bills received by intermediaries from beneficiaries or physicians requiring a check of the central records to determine whether the $50 deductible under the supplementary plan has been met or whether the person is entitled to benefits under this part of the health insurance program. This issue of the BULLETIN (pages 3-16) carries a full report of the statistical system established by the Office of Research and Statistics. Included in the article are the number of hospitals and home health agencies that are participating under the health insurance program and data on inpatient hospital claims paid for the first 3 months. PUBLIC INCOME-MAINTENANCE PAYMENTS SHOW THIRD-QUARTER RISE Total payments under public income-maintenance programs for the third quarter of 1966 were $310 million higher than the total for the preceding quarter, and they were $622 million greater than the amount reached in July-September 1965. These increases were attributable primarily to the health insurance benefits under OASDHI. More than $291 million was paid out in July-September under this new program for the aged, which began operations July 1, 1966. For unemployment insurance benefits, the total was the lowest reported in nearly a decade. The national decline of 30,000 in medical assistance for the aged reflected largely the discontinuance of the program in Massachusetts, which initiated a medical assistance program under title XIX of the Social Security Act. Twelve of the 25 States with medical assistance programs reported a September total of 690,000 recipients. Expenditures for assistance reached $520.0 million in September, about the same as the August amount. As in other recent months, medical vendor payments rose under medical assistance and declined in the other programs. Expenditures for money payments were higher in all the programs, and aid to families with dependent children reported the largest increase. PA CASELOADS IN MONEY-PAYMENT PROGRAMS SHOW SLIGHT RISE In September, all the public assistance programs making direct money payments showed slight relative increases in the number of persons assisted. The largest increase occurred in aid to families with dependent children (25,300 recipients or 0.6 percent), despite a drop of 5,500 in the unemployed-parent segment of the program. The number of old-age assistance recipients was 3,700 or 0.2 percent higher than the number in August, and New York accounted for 1,700 of the increase. Smaller numbers were added to the rolls in aid to the permanently and totally disabled, aid to the blind, and general assistance. P > On July 1, 1966, the health insurance program for the aged under the Social Security Act went into effect. This program helps to close a major gap in the economic security of the elderly by e providing protection against the high costs of hospital and medical care. The program will have a significant impact on the organization, provixion, and financing of health and medical care in the country. Information on the broad scope of benefits and the large population group involved is being incorporated in a comprehensive datacollection system that will provide a means for evaluating the effectiveness of the program. This article describes briefly the provisions of the health insurance program for the aged, outlines the various components of the statistical system for collection and maintenance of data on the utilization and financing of hospital and medical services and delineates the analytical studies envisioned. State data are presented on the number of hospitals and home health agencies participating under the program. Also presented are 3 months' data on claims paid, based on the bills received from hospitals that have been processed and approved for payment by intermediaries under the hospital insurance program. Basic Provisions of Law The 1965 amendments to the Social Security Act added title XVIII to the Act, which provides for two coordinated programs of health insurance for the aged: a basic hospital insurance plan (part A) and a voluntary supplementary medical insurance plan (part B).1 Director, Division of Health Insurance Studies, Office of Research and Statistics. 1 For a full description of the provisions of the health insurance program, see Wilbur J. Cohen and Robert M. Ball, "Social Security Amendments of 1965: Summary and Legislative History," Social Security Bulletin, September 1965; see also Robert M. Ball, "Health Insurance for People Aged 65 and Over: First Steps in Administration," the Bulletin, February 1966. BENEFITS The hospital insurance program provides payment for a large part of the cost of hospital services in a participating hospital for up to 90 days in a "spell of illness" (a period beginning with the first day of hospitalization and ending 60 days after discharge from a hospital or an extended-care facility). The first 60 days of hospitalization are covered essentially in full after a deductible of $40. For each of the remaining 30 covered days in a spell of illness, the patient pays $10 of the daily cost. The program pays 80 percent of the cost of outpatient hospital diagnostic services furnished during a 20-day period, after a deductible of $20. The program also covers the cost of care up to 100 days during a spell of illness in a participating extended-care facility after transfer from a hospital following a stay of 3 or more days. (This part of the program began January 1, 1967.) The cost of the first 20 days is covered in full; the patient pays $5 of the daily cost for each of the remaining 80 covered days. For the cost of home health services, up to 100 visits during the year are covered, following discharge from a hospital (after a stay of at least 3 days) or from an extended-care facility. The supplementary medical insurance program provides payment for 80 percent of the reasonable charges for physician services and other covered services following payment by the patient of the first $50 of such charges during the calendar year. The program covers the following services: physician services, regardless of place of service; up to 100 home health visits each year; various other medical and health services, such as diagnostic X-ray and laboratory tests; X-ray, radium, and radioactive isotope therapy; prosthetic devices; and the rental of durable medical equipment. ELIGIBILITY The nearly 19 million persons identified as eligible for the hospital insurance benefits as of July 1, 1966, consist of all persons aged 65 or over who |