Private Insurance to Supplement Medicare: Hearing Before the Subcommittee on Commerce, Consumer Protection, and Competitiveness of the Committee on Energy and Commerce, House of Representatives, One Hundred First Congress, First Session, April 6, 1989

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Page 10 - Act, provides coverage for a broad range of health services for most people 65 years of age or older and some disabled persons. The program has two parts. Part A, hospital insurance, covers inpatient hospital, skilled nursing facility, hospice, and home health care. P-art B, supplementary medical insurance, covers many types of noninstitutional services, such as physicians, clinical laboratory, X-ray, and physical therapy services.
Page 1 - HOUSE OF REPRESENTATIVES, COMMITTEE ON ENERGY AND COMMERCE, SUBCOMMITTEE ON COMMERCE, CONSUMER PROTECTION, AND COMPETITIVENESS, Washington, DC. The subcommittee met, pursuant to notice, at 10 am, in room 2322, Rayburn House Office Building, Hon.
Page 17 - ... a loss ratio represents the percentage of premiums collected that are paid in benefits; thus, it is sometimes considered a measure of the policy's economic value. The Baucus Amendment established a minimum standard for anticipated loss ratios of Medigap policies. The expected loss ratio had to be at least 60 percent for individual policies and 75 percent for group policies. This expected loss ratio is a target, not a requirement for actual performance. The actual loss ratios of most policies...
Page 67 - Annual Report of the Board of Trustees of the Supplementary Medical Insurance Trust Fund, March 2000.
Page 12 - MCCA, which became law in July 1988, provided for the most significant expansion of Medicare benefits since the program's beginning. Beneficiary out-of-pocket costs for covered services were to be capped, and additional services would have been covered when the law was fully implemented. In June and April 1989, we testified before committees of both houses of Congress on the effects of the MCCA on benefits provided by the Medicare program and Medigap insurancel.
Page 7 - ... Medicare. On the other hand, several policies we reviewed also provided some coverage beyond the minimum requirements. For consumers, it is important that they shop carefully to find the policy with coverage benefits that fits their individual needs. Loss Ratios of Medigap Policies As mentioned above, a loss ratio represents the percentage of premiums collected that are paid in benefits; thus, it is sometimes considered a measure of the policy's economic value. The Baucus Amendment established...
Page 8 - ... analysis had nationwide 1984 premiums of $1.3 billion, and Prudential — with a 1984 loss ratio of about 78 percent — had almost 25 percent of that business. For the individual policies of all commercial insurers studied, the weighted average loss ratio was about 60 percent for 1984. In other words, $770 million in benefits were returned for the $1.3 billion in premiums paid. Thus, for every $1 in premiums, 60 cents...
Page 5 - B, supplementary medical insurance, covers many types of non institutional services, such as physicians, clinical laboratory. X-ray, and physical therapy services. Both parts require beneficiaries to share in the cost of their care through deductibles and coinsurance. Almost from Medicare's beginning...
Page 18 - For the individual policies of commercial insurers studied, the weighted average loss ratio was about 60 percent for 1984. In other words, $770 million in benefits were returned for the $1.3 billion in premiums paid. Thus, for every $1 in premiums, 60 cents was returned as claims payments or used to increase reserves, and 40 cents represented administrative and marketing costs and profits. The same figures for the Blue Cross/Blue Shield plans studied are 81 cents in benefits to 19 cents in costs...
Page 67 - ... with concern the rapid growth in the cost of the program. Growth rates have been so rapid that outlays of the program have nearly doubled in the last 5 years.

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