HEARING - U.S. Senate Special Committee on Aging

48
plement policy, what should that policy do and not do. And there
was broad agreement about what it should do and not do. So all
the States have laws saying what Medicare supplement policies can
do and not do. And by law, there is no duplication of Medicare by a
Medicare supplement policy. So I do not see how they can make a
statement like that.
Chairman MELCHER. Would you mind digesting it? I think there
are only 80 pages or so. Would you mind digesting it and giving us
your reaction to it, because I suppose it has a certain amount of
prestige, and we need to fully understand--
Mr. SHAPLAND. I would say that that statement somehow had to
be taken out of context, or I did not understand it.
Chairman MELCHER. Yes, and that is a danger we are all prone
to fall into. It would be helpful for us on the committee if we could
have your reaction.
Mr. SHAPLAND. I will be glad to serve your committee in that
way.
Chairman MELCHER. All right, thank you.
One last thing. Would you recommend that standards be established
for private insurance coverage to complement Medicare? We
have already got the standards to a certain degree, that require
Medigap policies attempt to describe their coverage. If we are seeking
to close some of the real gaps, the real catastrophic gaps that
now exist between private insurance and Medicare, shouldn't we
have some sort of a requirement established that private insurance
might attempt to pick up what is now totally uncovered, such as in
many instances, nursing home or home health care?
Mr. SHAPLAND. I think I understood you to say you understood
that Medicare supplement policies do have in every State a legal
standard that we have to follow.
Chairman MELCHER. Yes.
Mr. SHAPLAND. OK. But as I mentioned earlier and we got into a
good dissertation on, those Medicare supplement policies only cover
the types of medical expenses covered by Medicare itself, and when
Medicare runs out or has coinsurance, then these policies fill in
those gaps.
But like you mentioned, nursing homes are not covered. Medicare
supplement policies do not cover nursing home care.
Chairman MELCHER. Or home health care.
Mr. SHAPLAND. Or home health care and so on. Actually, Medicare
pays 100 percent of the home health care it recognizes, but
sometimes Medicare does not recognize certain kinds of home
health care.
As far as nursing home care is concerned-and that is the great,
big area of catastrophic cost-the National Association of Insurance
Commissioners spent some time with the industry and other
people on this very. issue that you raised and just adopted some
standards for nursing home policies.
Chairman MELCHER. Would you provide those for us?
Mr. SHAPLAND. Sure.
Chairman MELCHER. All right. Thank you very much, Mr. Sham
land.
[The prepared statement of Mr. Shapland follows:]