HEARING - U.S. Senate Special Committee on Aging

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industry's role in providing catastrophic care and where they. are
not providing catastrophic care.
The statement was made that the Government needs to take
care of people as the last sort; people need to feel that they are
taking care of themselves to the extent they can-that is rightand
then, Government needs to realize where people cannot take
care of themselves and step in. It is the same thing with Government's
role in any other field, like transportation, food, national
defense, or anything; where people cannot take care of themselves,
the government steps in. And there are some areas here where the
Government does need to step in and already has stepped in-to
some degree, and I think we need to ask ourselves what expanded
role of stepping in does the Federal Government need to do.
Talking about education, I think you are absolutely right, and it
has been made clear here at the hearing, that there are great misunderstandings
about what Medicare does. I work with it every day
in insurance, so I have learned it. But even for me it was a long
process. Insurance of any kind is hard to comprehend.
Somebody made a comment about a burglary and what does the
insurance company cover. I have the same problems, even though I
am an actuary and work with insurance every day. Insurance is
not an easy subject, and it takes a lot of education.
I think the Government has probably been remiss in its efforts
on educating the public about Medicare. Surveys have shown that
the vast majority of people in the United States think that Medicare
pays for nursing care, when it does not, and some other kinds
of care, and have relied falsely on their honest perceptions of what
Medicare is.
I think the industry, on the other hand, has been way more
active and deserves plaudits for its efforts at educating the public
regarding Medicare. We go out and sell Medicare supplement policies
and spend a lot of energy explaining to the public what Medicare
pays, what our policies pay, what Medicare does not pay and
what our policies do not pay.
We have developed, in conjunction with HCFA, buyers' guides
that explain what Medicare is all about and what the Medicare
supplement pays, and it also says that Medicare does not cover
long-term care, for example, and that our policies do not.
Actually, when we sell a Medicare supplement policy, we have
got to give the purchaser several pieces of paper that say what we
do not cover and also tell him that the Government does not cover
it, either. So we have gone out of our way to help educate the
public and be honest about what we do not do. I think we have
probably done more of that than any other industry. I do not know
that the auto industry or any other industry have gone out there
and said what their product does not do, like we are.
But that does not mean that that is enough. I think that it has
been proven here today by the witnesses that there is just a lot
more educating to be done.
There was a lot of discussion here about Medicaid and people
having to be impoverished to get Medicaid. I think that that is
something that you are going to really have to wrestle withwhether
somebody should be able to keep $4,000 for burial before
they go on Medicaid, and those kinds of questions. Those questions