Dr. MERRIAM. Yes, and not generally available except through group prepayment plans or through multiple coverage.

Senator FONG. Now, you stated that there are also approximately 813 million people who are without insurance. How many of this 8 million are presently not working?

Dr. MERRIAM. I would assume the great majority of them are presently not working.

Senator FONG. Of the 17 million aged people, what percentage would you say are not employed?

Dr. MERRIAM. Well, about 234 million are working, part time or full time. The majority of those who are not covered, tend to be older, they tend to be in poor health, they tend to have less income, and therefore, there will be fewer working in that group.

Senator FONG. There are approximately 142 million people who are not employed, is that correct, out of 17 million?

Dr. MERRIAM. That is right.

Senator FONG. Of that 142 million people, how many could pay for their insurance costs?

Dr. MERRIAM. Well, I think this depends on how much of your income you think you can afford to pay for insurance as against food and other things.

I don't want to load you with figures, but let me go back to your question about the differences in income between those who did and those who did not work. Of those who worked in 1962-that is the 234 million aged-for the beneficiaries, the average income of couples was about $4,000 a year. For couples who were not getting OASI, it was about $6,000 a year. But for those who did not work, the total income for the year was $2,400 in the case of couples who were drawing benefits, $1,800 in the case of these who were not.

Now, take even the more fortunate of the nonemployed group, those who are getting OASI benefits-with an income of $2,400 a year, if your hospital insurance alone costs on the average $112 per person, $224 for the couple, and then you bought surgical insurance and had to take out major medical to cover physicians and nursing care and drugs and all the other things, it would get up to be quite a sizable proportion of your income.

Senator FONG. Under those circumstances, a couple who makes $2,400 is unable to buy any insurance; almost?

Dr. MERRIAM. Well, it would take a very sizable proportion of their income to buy even limited coverage. It would take 10 percent of their income to buy hospital insurance alone, which would leave all the rest of their bills uncovered.

Senator FONG. How many of the 142 million people are under oldage assistance?

Dr. MERRIAM. Old-age assistance?

Senator FONG. Yes.

Dr. MERRIAM. About 2 million, a little over 2 million. Two and a third million.

Senator FONG. How many of them would qualify under the KerrMills law?

Dr. MERRIAM. Actually, the Kerr-Mills bill applies to people who are slightly above the old-age assistance level, as well as providing some additional funds to help those on assistance. Theoretically, all of those under old-age assistance should get some help with their medical bills, though the amount of it varies greatly.

Senator MUSKIE. Will the Senator yield?

Senator FONG. Yes.

Senator MUSKIE. Not all States have adopted Kerr-Mills.
Dr. MERRIAM. No.

Senator MUSKIE. When you talk about those who are not eligible under Kerr-Mills you would have to exclude that portion of them who live in States which have not yet enacted Kerr-Mills legislation.

Dr. MERRIAM. Yes. Only about two-thirds of the States have adopted medical assistance to the aged programs.

Senator FONG. If the Kerr-Mills program were enacted in every State, with the benefit at the minimum which the States now having Kerr-Mills programs give to their people who need medical care, how many of these 142 million people not on OAA or 83 million people without health insurance would be taken care of?

Dr. MERRIAM. Senator, I am sorry, I do not have that figure. I would be glad to try to get some kind of an estimate and put it in the record.

Senator NEUBERGER. Will the Senator yield on that point?
Senator FONG. Yes.

Senator NEUBERGER. But, also, every State has variations in the benefits. For instance, what does Hawaii do under Kerr-Mills?

Senator FONG. Hawaii has very liberal benefits. So long as the medical indigent is unable to pay for his medical bills, Hawaii is very, very liberal.

Senator NEUBERGER. It would behoove someone who is in that income bracket to move to Hawaii, New York, or Pennsylvania, wouldn't it, besides being good places to live. [Laughter.]

Senator FONG. Is it possible for you to work out some figures for this committee showing what I am trying to bring out? I am just trying to get the picture.

Dr. MERRIAM. I am sure, Senator, we can get for you figures, first on the number of people who have had some assistance under KerrMills, and then what you are asking is, supposing every State did have it at some level, what would the scope of the program be? One can always suppose. We will submit an estimate for the record. Senator FONG. Thank you.

Senator NEUBERGER. It is very nice of you to do that, but it seems so hypothetical. It would be like, What would be the average weight of everybody who eats 2,000 calories a day? It is so intangible with the great variations.

Senator MCNAMARA. Well, if you will, furnish for the record the answer to the Senator's question to the best of your ability. Will you do that? Dr. MERRIAM. I will.

(The information to be furnished follows:)

The attached table indicates the number of persons receiving medical assistance for the aged and the amount of the payments in February 1964, in the 35 States with programs in operation. It is estimated that if all States had medical assistance programs for the aged equal in scope and services to the best existing programs the additional cost would be between $1.8 and $2 billion a year.

TABLE 4.-Medical assistance for the aged: Recipients and payments for recipients, by State, February 19641

2 Persons for whom vendor payments were made during the report month.

3 Data for January: February data not available.

4 Includes money payments not subject to Federal participation as follows: $811 in Connecticut, $6,054 in Kansas, $99,498 in Massachusetts, $11,087 in New Jersey, $48,146 in New York, and $2,299 in North Dakota.

Represents medical assistance for the aged under program for aid to the aged, blind, or disabled and medical assistance for the aged.

6 Estimated.

7 Program initiated in January 1964.

8 Includes an unknown number of cases receiving only money payments.

Average payment not computed on base of fewer than 50 recipients; percentage change on fewer than 100 recipients.

Senator MCNAMARA. Are you through?

Senator FONG. Yes.

Senator MCNAMARA. Senator Neuberger, do you have any questions or comments?

Senator NEUBERGER. No.

Senator MCNAMARA. Again, Doctor, we want to thank you very much for your help.

Dr. MERRIAM. Thank you.

Senator MCNAMARA. Our second witness this morning is Dr. Forrest E. Linder, Director of the National Center for Health Statistics, U.S. Public Health Service.

STATEMENT OF DR. FORREST E. LINDER, DIRECTOR, NATIONAL CENTER FOR HEALTH STATISTICS, U.S. PUBLIC HEALTH SERVICE; ACCOMPANIED BY THEODORE D. WOOLSEY, DEPUTY DIRECTOR; AND DR. PHILIP S. LAWRENCE, CHIEF, HEALTH INTERVIEW STATISTICS DIVISION, NATIONAL CENTER FOR HEALTH STATISTICS

Senator MCNAMARA. You may proceed.

Dr. LINDER. I have with me today Mr. Woolsey, who is the Deputy Director of the Center and in charge overall of the technical aspects of our work and Dr. Philip Lawrence, who is directly in charge of the Health Interview Survey which, in our organization, produces the kind of material that we will present today.

Senator MCNAMARA. Thank you.

Dr. LINDER. I am very pleased to be able to come before you and give you a few figures from our surveys on the extent and adequacy of hospital insurance coverage among the older people.

The most recent information on health insurance coverage from the health interview survey is based on data collected as a supplementary item to the health interview during the period July 1962 to June 1963. While information was obtained on three types of coverage-hospitalization, surgery, and physician services this presentation, in the interest of brevity, will be restricted to statistics pertaining to hospital insurance.

Approximately 54 percent or 9,100,000 of the 17 million persons 65 years and older living in the civilian, noninstitutional population have some form of hospital insurance, according to our figures. This estimate is in contrast to 72 percent coverage among people under 65 years of age, and 70 percent for the population of all ages.

Hospital insurance is defined in the survey as any plan, either group or individual, specifically designed to pay all or part of the hospital expenses for the insured person. The plan must be a formal one with defined membership; the premiums may be paid by the individual, his employer, a third party, or a combination of these.

Specifically excluded from our figures are plans limited to specific "dread diseases"; those that pay only for accidental injury; free care provided by public welfare, veterans' facilities, care given to dependents of uniformed service personnel, crippled children's programs, and the like; and plans which pay only for loss of income.

Among persons 65 years and older, the rate of insurance coverage ranged from 39 percent of the 6 million living in families with less than $2,000 income to 73 percent of the 1 million in families with annual income of $10,000 or more.

A comparable range for the insurance coverage of persons under 65 was from 32 percent in the low-income group to 89 percent for those in families where the income was in excess of $10,000.

In all income groups, the rate of coverage was appreciably higher for those 65 to 74 years of age than that for persons 75 years of age

and over.

33-420-64-pt. 1——3

About 11 million, or roughly two-thirds of the older group are in the age group 65 to 74; and their rate of hospital insurance coverage is 61 percent. The remaining one-third of this group, 75 years and older, have an insurance coverage rate of 41 percent.

Of the 129 million people in the country covered by hospital insurance, approximately 10 percent have more than 1 hospital insurance plan. However, among persons 65 years and over, the rate of multiple coverage is estimated at 1312 percent.

Similar to the pattern for the total population, the rate of multiple insurance coverage among persons 65 years and over increased with amount of income from 10 percent among families with income less than $2,000 to 17 percent for those with income $10,000 or more.

Even though the extent of hospital insurance coverage provides a broad measure of the protection afforded the population against the hazards of illness, a more definitive measure is the availability and adequacy of this protection when hospital services are needed.

Based on data collected during the period, July 1958 to June 1960, some portion of the hospital bill was paid by insurance for 68 percent of the discharges that had been hospitalized overnight or longer in short-stay hospitals.

Included in this percentage were 51 percent that had three-quarters or more of the bill paid by insurance.

Among persons over 65, approximately 51 percent of the discharges had some portion of the bill covered by insurance, while a comparable proportion among persons under 65 was 70 percent.

For both young and old people, the percentage of discharges that had any part of the bill paid by insurance increased with amount of family income.

Among persons 65 and older, the proportion with some part of the bill covered was 43 percent for those in families with less than $2,000 income. Included in this percentage were 24 percent of the discharges for which insurance paid three-quarters or more of the hospital bill. This presentation has been a summary and in a report which we have provided for the committee, we have given more detailed information and, of course, we would be glad to supply other facts that we have that would be of interest to the committee.

Thank you, Mr. Chairman.

Senator MCNAMARA. Thank you very much, Dr. Linder.

I notice that your definition of hospital expense insurance excludes policies which only provide coverage for specific dread diseases. Could you tell us why such policies are not included?

Dr. LINDER. Well, these are policies such as those which were very popular a few years ago in which you could take out a brief policy for poliomyelitis or something like that.

These are probably very limited and probably not very numerous, so these have not been included in our definition.

Senator MCNAMARA. They are not of sufficient number to give a great deal of weight to your testimony.

Dr. LINDER. That is our impression.

Senator MCNAMARA. On the basis of insurance company reports to the subcommittee, it would appear that your estimate of the number of older persons who have more than one hospital expense policy may be lower than actually is the case.