HEARING - U.S. Senate Special Committee on Aging

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49 Statsment -2f the IEALTh IN5LFANCE ASSOCIATION OF AMERCA on CATASTROPRIC WEALTH CARE COSTS Presented by Robert Shapland Vice President an1 Actuary k&itual1 of Om~aha Insurance Comp~any Before tre <strong>Senate</strong> <strong>Special</strong> Cuamidttee on Aging January 26, 1987 Washington, D.C.
50 - 2 - I am Robert Shapland, Vice President and Actuary for the Mutual of Omaha. Today I also represent the Health Insurance Association of America. The HLOA is a trade association, representing sane 335 insurance companies. Our inmbers write over 85 percent of the private health insurance provided by iVsuance companies in this country. Many of these comrpanies, includi my own, also design and underwrite private insurance plans that coordinate with the Medicare Program. Mutual of Onaha has many years of experience in that particular business. The HIAA appreciates this opportunity to conent on proposals for financing catastrophic health care under Medicare. We conmend you, Senator Velcher, and this comnittee for exploring this issue, however, we encourage you to look beyond mechanisms for financing acute hospital and medical care. Acute hospital/medical care expenses are not the predominant cause of catastrophic expenses among the aged. In fact, approximately 70 percent of Medicare eligibles have catastrophic private Medicare Supplement coverage. The elderly are most at risk for chronic long term care and outpatient drug expenses - items not covered by Medicare. Specifically, 42 percent of the elderly's total out-of-pocket expenses are for nursing home care. Long tern care is a complex health policy issue reqiring thoughtful and balanced debate. If I could summarize for you the prevailing conclusion frum our industry's assessments of Medicare and its present condition, I would have to say that we see no cuzpeling need to begin a major overhaul of this program. In our opinion, the current cumnination of private and public coverage is serving the public well. So, since the system obviously is not -broken', a major *fix" hardly seems warranted.
Page 1 and 2: S. HRG. 100-69 CATASTROPHIC HEALTH
Page 3 and 4: CONTENTS Opening statement by Senat
Page 5 and 6: 2 Second, I think the private insur
Page 7 and 8: 4 So the question before us is how
Page 9 and 10: 6 the elderly, long-term health car
Page 11 and 12: 8 ments for our retirement. I might
Page 13 and 14: 10 Mrs. YELINECK. Well, it would be
Page 15 and 16: 12 As I understand it, you have not
Page 17 and 18: 14 Mrs. YELINECK. One does not expe
Page 19 and 20: 16 Senator BURDICK. Well, thank you
Page 21 and 22: 18 Mrs. YEL.INECK. No. I started ou
Page 23 and 24: 20 Therefore-I am supposed to take
Page 25 and 26: 22 Chairman MELCHER. Well, I am ple
Page 27 and 28: 24 month. Let us assume it costs $1
Page 29 and 30: 26 STATEMENT BY SENATOR PETE WILSON
Page 31 and 32: 28 Mrs. RIEGER. We have; we have wo
Page 33 and 34: 30 Four years ago this August was w
Page 35 and 36: 32 she has only 50 percent vision i
Page 37 and 38: 34 Senator HEINZ. So it is both a p
Page 39 and 40: 36 rich. Indeed, in the academic co
Page 41 and 42: 38 pointedly in the comment from Mr
Page 43 and 44: 40 finding out is that it is very l
Page 45 and 46: 42 industry's role in providing cat
Page 47 and 48: 44 Senator HEINZ. So things are wor
Page 49 and 50: 46 Chairman MELCHER. In exactly the
Page 51: 48 plement policy, what should that
Page 55 and 56: 52 - 4 - CATASTRIPC PROTECTION IiDE
Page 57 and 58: 54 -6- MiCIGAP INSJRANCE: A RPL1C/P
Page 59 and 60: 56 To ensure that all of these cont
Page 61 and 62: 58 - 10 - The HJAA also endorses Me
Page 63 and 64: 60 - 12 - Finally, given that Congr
Page 65 and 66: 62 - 14 - A recent HLAA survey of o
Page 67 and 68: 64 Chairman MELCHER. Senator Heinz.
Page 69 and 70: 66 Mr. SHAPLAND. I think we are in
Page 71 and 72: 68 Those problems are real problems
Page 73 and 74: 70 Mr. SHAPLAND. Oh, no. There are
Page 75 and 76: 72 comprehension, and it is growing
Page 77 and 78: 74 that educational process, and we
Page 79 and 80: 76 So we have supported and activel
Page 81 and 82: 78 Mr. SHIAPLAND. How much would nu
Page 83 and 84: 80 rently being offered by the indu
Page 85 and 86: 82 Recently, Karri Lynn has started
Page 87 and 88: 84 Mr. Chairman and Members of the
Page 89 and 90: 86 standards for voluntary certific
Page 91 and 92: 88 non-group subscribers of reporti
Page 93 and 94: 90 We believe a new federal program
Page 95 and 96: 92 However, public awareness is nee
Page 97 and 98: 94 Item 3 Testi~ony of GAIL SHEARER
Page 99 and 100: 96 to Secretary Bowen's proposals c
Page 101 and 102: 98 -4- most-states do not monitor t
Page 103 and 104:
100 Catastrophic Protection within
Page 105 and 106:
102 - a - participants and in part
Page 107 and 108:
104 - 2-- Consumers Union suV orts
Page 109 and 110:
106 29), but fails to acknowledge t
Page 111 and 112:
108 explore all alternatives to lon
Page 113 and 114:
110 adds to the complexity of Medic
Page 115 and 116:
112 - 10- Consider first the propos
Page 117 and 118:
114 - 12- insurance premiums and me
Page 119 and 120:
Consunmer Unon Pubtishcr of Consume
Page 121 and 122:
FOR RELEASE AT 9:00 P.M. H2ST) TUES
Page 123 and 124:
120 Itema I CENTER FOR MEDICARE ALw
Page 125 and 126:
Page 3 122 aide services, however,
Page 127 and 128:
Page 5 state treasuries." 124 Judge
Page 129 and 130:
126 462 6485 New Developments 10,05
Page 131 and 132:
128 462 6-85 New Developments 10,05
Page 133 and 134:
130 462 6-85 New Developments 10,05
Page 135 and 136:
132 10,930 New Developments tI.PZ ;
Page 137 and 138:
10,932 134 New Davelopments 492 346
Page 139 and 140:
136 10,934 New Developments It! ;6
Page 141 and 142:
10,936 138 New Developmenlt I. Thc
Page 143 and 144:
140 10,938 New Development. 492 S-8
Page 145 and 146:
10,940 142 New Developments i92 586
Page 147 and 148:
ATroR EYS -HARLES C. -ULiIN JUDITH
Page 149 and 150:
146 reformed its decision-making pr
Page 151 and 152:
148 : 14 2i57 New Developments 13,1
Page 153 and 154:
~ 150 a>, rsn Cdw ~w (e d rum 0A7,.
Page 155 and 156:
152 All Of these figures are based
Page 157 and 158:
154 The requirements of this Act sh
Page 159 and 160:
156 Drefting Note: Where the word "
Page 161 and 162:
158 (b) The issuance of the group p
Page 163 and 164:
160 (2) Contain a provision establi
Page 165 and 166:
162 and competitive reasons. It is
Page 167 and 168:
164 -13- E. Affordability of Long T
Page 169 and 170:
NAIC LTC ADVISORY COMMITEE EXPOSURE
Page 171 and 172:
Setinzn IS. Poicyx D~efinitieno aid
Page 173 and 174:
170 3. The term "noncancellable' ma
Page 175 and 176:
172 extension of benefits beyond th
Page 177 and 178:
artinM B Requirmnts for Rplnmacwt 1
Page 179 and 180:
176 The above "Notice to Applicant"
Page 181 and 182:
(pinnal Rasting &mdsninn 178 Benefi
Page 183 and 184:
APPEMI!X B 180 OCWARISCN OF lVLCY i
Page 185 and 186:
COMPAIeSON OF LOtG TEIM CoAt PfLtCI
Page 187 and 188:
COMPABI:SZN OF LC#C TE" CAiE -OLICI
Page 189 and 190:
COWaPAISON Of LOSt TERM CARE POLICI
Page 191 and 192:
cowRiiSOi or touTE reM CasE nOuczcS
Page 193 and 194:
COGPARISON OF LONG TERM CARE POLICI
Page 195 and 196:
SOME BASIC THINGS YOU SHOULD KNOW M
Page 197 and 198:
Private health insurance is availab
Page 199 and 200:
WHAT MEDICARE PART B PAYS 196 MEDIC
Page 201 and 202:
EXPENSES NOT COVERED BY MEDICARE Me
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HEARING - U.S. Senate Special Committee on Aging

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