HEARING - U.S. Senate Special Committee on Aging

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65 Columbus was dealing with an educational process is to slightly understate the problem. Mr. SHAPLAND. I am sorry, but I do not follow that. I would think it would be an educational process. Senator HEINZ. Well, what I am saying is when you have most of the people, including people who have learned the hard way, thinking they are going to be taken care of, and they are not, that means that there is a body of conventional wisdom out there that is so broad and so deep that it defies what we think of as education. I do not know what the next hierarchy of convincing people that the world is round rather than flat has to do with, but it is deeper than-there is just a little prejudice we have to overcome here. Mr. SHAPLAND. It seems like you are saying that it is beyond education. I would hope it would not be. You might be right that we can educate the people. Senator HEINZ. Well, we have had Medicare for 20 years. The coverage on it has not been expanding. Mr. SHAPLAND. But how much energy has the Federal Government spent on telling people that nursing home coverage was not covered so there was not a misunderstanding? Senator HEINZ. So we should have an educational program that says the Federal Government does not cover nursing home care, and so do not get sick? Mr. SHAPLAND. The private insurance industry does, by the way. The private insurance industry says our policies do not cover longterm care. Is the Federal Government doing that, saying our program does not cover long-term care? Senator HEINZ. So what should anybody be doing about the problem? You say it is an educational problem. Mr. SHAPLAND. First of all, you have to understand that you need the insurance and that you do not already have it. You are not going to go out and buy private insurance if you think you already have it. We are doing our part, and we will be glad to do more, and we ask you to do the same. Senator HEINZ. Well, what should we be doing? Mr. SHAPLAND. First of all, both of us have to help educate the public that they do not have the coverage, so that they purchase the coverage out there. I think the last survey said there were something like 70 companies offering long-term care insurance. Senator HEINZ. Well, I understand we both have to somehow educate the public. How do we do it? Mr. SHAPLAND. I am not in the education business. Senator HEINZ. Senator Melcher is holding a hearing, which is not unlike hearings I held over the last 6 years, to try to educate the public that when it comes to long-term care, the typical American has this insurance "bulletproof vest," but as I said, it has got a big hole over the heart, because it does not cover long-term care. We have been trying-Senator Melcher has been a party to those efforts. He and I served in the House together. We have been aware of that problem. We have been trying to dramatize it for in excess of a decade. You know, we need some ideas as to how we can do a better job, because we are not doing a very good job at this point.
66 Mr. SHAPLAND. I think we are in absolute agreement. Senator HEINZ. Yes, but how do we do a better job? Mr. SHAPLAND. OK. I guess if I were in your position, I would look for somebody in advertising to help me, because I am not an expert in that, and you probably are not either. I do not know if you use full-page ads, if you use newspapers, broadcasting-I do not know what you do. That is up to people who are experts in educating people and advertising and so on. I think we need to look for help in that area; I agree with you. Senator HEINZ. Just call up Doyle-Dane-Bernbach and buy some advertising. Mr. SHAPLAND. Sure. Senator HEINZ. Thank you. Chairman MELCHER. Senator Pressler? Senator PRESSLER. Let me first of all welcome you here to this committee. I know you are associated with Mutual of Omaha, which is headed by Mr. V.J. Skutt, who is formerly from South Dakota, and I think he is one of the most honest and finest menwe are very proud of him. He comes back to South Dakota about once a year to give a speech. The point I am making through that is that we seem to have a problem here, but I do not think it is necessarily the fault of the private insurance companies. If there is misinformation, we should root it out. But there is nothing wrong with being in business. You have got to make a profit. I think it is easy to "beat up" on the health insurance companies, but I do not know if that does much good, especially since you are here with crutches, so we should not beat up on you. Mr. SHAPLAND. Go ahead and beat on me. Senator PRESSLER. The thing we are trying to find here is the truth and who is responsible. In many areas, as you have pointed out, the private health insurance companies appear to be doing what they say they are doing, and they are not misleading anybody. But there are still people-and we have heard cases this morning of people who are falling through the cracks somehow. I am just embarking on a visit to all 66 counties in my State, which will take a while to get done if I want to keep my voting record up here in the <strong>Senate</strong>. I am sure that in many of those counties, I will meet people who will say that they cannot buy private health insurance for one reason or another, and they are left out in the cold. So we do have these catastrophic cases. I want to just address a general question to you about the group you represent-and I know that you are an easy target for criticism. But does the profitability of the health insurance-companies that you represent exceed the profitability of other insurance companies? Could you explain a bit of that? Mr. SHAPLAND. Sure. I do not know what the figure is, so I will just make a rough approximation, and I do not know that it is too critical. But I would say maybe half or a lot more of insurance is sold by nonprofit insurance companies. Senator PRESSLER. By nonprofit companies? Mr. SHAPLAND. Nonprofit insurance companies, like Mutual of Omaha. They are designated "mutual" companies.
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S. HRG. 100-69 CATASTROPHIC HEALTH
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CONTENTS Opening statement by Senat
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2 Second, I think the private insur
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4 So the question before us is how
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6 the elderly, long-term health car
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8 ments for our retirement. I might
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10 Mrs. YELINECK. Well, it would be
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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 and 52: 48 plement policy, what should that
Page 53 and 54: 50 - 2 - I am Robert Shapland, Vice
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: 64 Chairman MELCHER. Senator Heinz.
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
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Consunmer Unon Pubtishcr of Consume
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FOR RELEASE AT 9:00 P.M. H2ST) TUES
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120 Itema I CENTER FOR MEDICARE ALw
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Page 3 122 aide services, however,
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Page 5 state treasuries." 124 Judge
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126 462 6485 New Developments 10,05
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128 462 6-85 New Developments 10,05
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130 462 6-85 New Developments 10,05
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132 10,930 New Developments tI.PZ ;
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10,932 134 New Davelopments 492 346
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136 10,934 New Developments It! ;6
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10,936 138 New Developmenlt I. Thc
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140 10,938 New Development. 492 S-8
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10,940 142 New Developments i92 586
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ATroR EYS -HARLES C. -ULiIN JUDITH
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146 reformed its decision-making pr
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148 : 14 2i57 New Developments 13,1
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~ 150 a>, rsn Cdw ~w (e d rum 0A7,.
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152 All Of these figures are based
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154 The requirements of this Act sh
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156 Drefting Note: Where the word "
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158 (b) The issuance of the group p
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160 (2) Contain a provision establi
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162 and competitive reasons. It is
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164 -13- E. Affordability of Long T
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NAIC LTC ADVISORY COMMITEE EXPOSURE
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Setinzn IS. Poicyx D~efinitieno aid
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170 3. The term "noncancellable' ma
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172 extension of benefits beyond th
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artinM B Requirmnts for Rplnmacwt 1
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176 The above "Notice to Applicant"
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(pinnal Rasting &mdsninn 178 Benefi
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APPEMI!X B 180 OCWARISCN OF lVLCY i
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COMPAIeSON OF LOtG TEIM CoAt PfLtCI
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COMPABI:SZN OF LC#C TE" CAiE -OLICI
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COWaPAISON Of LOSt TERM CARE POLICI
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cowRiiSOi or touTE reM CasE nOuczcS
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COGPARISON OF LONG TERM CARE POLICI
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SOME BASIC THINGS YOU SHOULD KNOW M
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Private health insurance is availab
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WHAT MEDICARE PART B PAYS 196 MEDIC
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EXPENSES NOT COVERED BY MEDICARE Me
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HEARING - U.S. Senate Special Committee on Aging

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