HEARING - U.S. Senate Special Committee on Aging

51
From all ixdications, the joint Medicare/e digap program enjoys a
remarkably high degree of public approval and meets acute care needs not
coered by Medicare. The Medicare program is being efficiently akninistered
by a successful partnership between the Health Care Financing Adninistration
and the private insurance industry. You should be mindful, however, that in
the past few years, underfurding of Medicare carriers and intenmediaries is
seriously underminirn that venture in cooperative management.
The fact that seventy percent of Medicare beneficiaries use private
supplemental insurance to fill the program's ever increasing Oeductibles and
co-payments attests to its success and to the practical accomwodation of
public and private interests. Since an additional 10 percent of the elderly
are covered by Medicaid, only 20 percent of those over 65 are witnout
protection against gaps in Medicare. It seems to me that this points out an
area where sane limited goverrnment action may be appropriate; i.e., to further
assist those few who are not able to cope financially with the rising
coinsurance, deductibles, and out-of-pocket costs associated with Medicare via
the purchase of s.plenental insurance. Although this problem for the elderly
poor should not be underestimated, it should not be the sole reason for a
major overhaul of a smoothly operating program. Limited financial ala to
those few indigent that fall outside of current Medicaid qualification rules
is the only supplemental coverage area where a problem exists and a solution
is needed.