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The INA MEND Institute is a partnership for progress. It is an opportunity for a major rehabilitation and educational complex-The Human Resources Center--to cooperate with a leading international business organization-insurance Company of North America-in a pioneering effort to salvage and rehabilitate the disabled and retarded, and to find ways to prevent accidents and losses that would cause people to become disabled.

It is more than this, too, for it is expected that the findings of the Institute's studies will relate to the development of practices and policies which will be applicable to a large portion of the hard-core unemployed who may well be labeled the able disabled. The aged, the infirm, the culturally disadvantaged, the educationally deprived-all of these can ultimately be helped to assume a new and contributing role in our society if we demonstrate the training, the skills and the techniques which will create in them motivation, responsibility and a chance to become self-supporting.

Not only does the work of the INA MEND Institute serve as an adjunct to INA's modern, far-seeing MEND rehabilitation program, but the research of the Institute is expected to provide significant information and support for INA's total program of resources management. Resources Management is a new dimension in insurance through which INA serves its insureds with a total program of loss prevention, risk management and rehabilitation; a program that goes well beyond the old idea that insurance is merely protection in the form

of payment of a claim when a loss has occurred.

Today, the insurance industry, with INA in a position of leadership, is concerned with the elimination of the causes of loss, damage and injury by working closely with the insured on programs ranging from safety incentive programs for employees to detailed recommendations on safety equipment and the elimination of physical and psychological hazards. The insurance industry aims to prevent the disabling injury from occurring, but if it occurs, it utilizes every aspect of financial, physical and vocational rehabilitation to minimize and, when possible, eliminate the disability.

Studies already underway at the INA MEND Institute will provide meaningful information toward the prevention of loss as well as the rehabilitation of the injured. This approach to insurance not only conserves people and their abilities but also conserves money. It has been demonstrated that both the insured and the insurance carrier can save dramatic sums of money when the theory of resources management is fully applied.

Thus, what this program means is manifold. But above all, the philosophical concept may be most significant. If what a man is worth can be measured by the productive contributions he makes, the most significant role of the INA MEND Institute is to help each person attain the zenith of his own ability. Then with his fellow man he can say, "I have lived and shared the actions and passions of my time."




Washington, D.O., December 5, 1969. Hon. PHILIP A. HART, U.S. Senate, Washington, D.O.

DEAR SENATOR HART: Thank you for inviting the Committee for National Health Insurance to testify in the hearings on automobile insurance. Because of prior commitments and because our program is still under development, I will be unable to appear personally to respond to the questions posed in your letter. I am pleased to provide responses as follows:

1. Should national health insurance absorb the medical care aspect of automobile insurance?

It is a basic position of our Committee that national health insurance benefits should extend to the entire range of services required for the prevention of illness, for the care and treatment of illness and injury and for medical rehabilitation. Thus, we believe health insurance should absorb the medical care aspects of automobile insurance.

2. Does the Committee feel that there is today an overlap of costs and benefits among the many programs?

Yes. In the area of health insurance coverage of hospitalization and surgery costs, many people have been sold duplicate and even triplicate coverages. We have all seen newspaper and direct mail advertisements that read, "$10,400 extra cash whenever you go to the hospital-pays in addition to any other companies' coverage you have," or, "$100 a week extra money hospital plan-if you get sick or hurt and land in the hospital, we'll send you these $100 a week checks on top of any other insurance you may have. Pay extra doctor or hospital bills. Or use it for the bills at home. Or take a vacation to get your strength back. Or even put your money in the bank ..."

These are only two examples of the type of sales promotion that is creating overlap of benefits and inflating hospital costs, which have soared higher than any other single item in the Consumer Price Index.

No mechanism exists under so-called “family'* automobile policies to deal with the problem of double or triple coverage for the same medical expenses

(except in cases where the other coverage is Workmen's Compensation). A person who possesses an automobile medical payments policy may collect under it for expenses already covered under an automobile bodily injury liability policy and/or a regular health insurance policy. The theory is that "the insured person has bought something and is entitled to get something for it." Companies are anxious not to offend their policyholders; moreover, investigations are expensive.

Under “Special," or "Package,"** Policies, however, steps are taken where appropriate to subrogate the guilty party, collecting on the other person's liability policy and saving on the medical payments policy. The "package" is cheaper overall than the "family” policy, and the company is correspondingly less free with its largesse. Similar action is taken with "assigned risk" cases, where the company is evidently not anxious to avoid offense. In no case is any check made of the extent of other insurance (Blue Cross, Blue Shield, major medical etc.) possessed by the person who claims under a medical payments (automobile) policy.

The duplication of benefits is putting many people in the hospitals who do not have to be there. By the design of the coverage, a great deal of unnecessary surgery is being performed.

The companies exercise virtually no responsibility for quality or cost controls. Automobile medical payment is made upon presentation of a paid-up bill, with no questions asked (beyond verification of the accident itself). This situation further skyrockets the costs of medical care.

3. How can we eliminate such an overlap and provide less costly medical care service?

Less costly medical care service has had only partial entry into the medical care system because of the failure of insurance to provide coverage of, and thus stimulate the development of, less costly services. In our insurance programs, we have been subsidizing a fragmented, wasteful, duplicative, inefficient, semifunctional nonsystem of medical service. Too much emphasis is placed on hospitalbased treatment and not enough on preventive and ambulatory care. We can change this situation when the health insurance fund serves to overcome the deficiencies in medical care organization, delivery, etc. The concept of health insurance as just another form of casualty insurance, with carriers promoting a glittering array of products to cover all or part of the hospital-related services, or slipping bits and pieces of coverage into casualty policies, needs replacement by new principles recognizing the right of the people to good health care and directing the health insurance program toward fulfillment of that right.

*These constitute the majority of automobile insurance policies. The insured person assembles his package piece, selecting whatever coverage he wishes to have in each area (property, theft, etc.).

**Insured person is given a "take-it-or-leave-it” package of benefits. Usually includes $1,000 medical payments coverage.

I am pleased to enclose a statement adopted by the Committee for National Health Insurance which spells out the principles to which we subscribe. Thank you for permitting us to comment on these matters. Sincerely,

MAX W. FINE, Executive Director. Enclosure.

Committee for
National Health Insurance

10. There should be appropriate provisions for effec-
tive participation by consumers and providers both in
the development of the national health insurance program
and on the advisory councils assisting in its continuing
public administration.

11. The national health insurance program should
be so structured and have such inter-agency relationships
as to enable it to influence substantially the accelerated
development of needed health manpower and facilities
and their availability, and to this end shall contribute
substantial and assured continuing financial support
toward the national development of adequate manpower,
facilities and organization needed for the effective deliv-
ery of comprehensive personal health care services in
all parts of the country.

12. Although primarily directed to the development
and support of comprehensive personal health care serv-
ices, the national health insurance program should also
have concern for the development of effective commu-
nity health and welfare programs at the national, state,
regional and local levels through comprehensive com-
munity health planning.

13. The national health insurance program should
provide for studies and demonstrations which give prom-
ise for continuing adjustment of the health services so
as to serve the changing needs of people in the most
efficient and effective manner consistent with sound pro-
fessional goals and standards and so as to utilize expand-
ing medical knowledge and skill.

14. The national health insurance program should be
designed and developed in accordance with these prin-
ciples and policies so that it shall function not merely
to increase national expenditures for health services but
also to contribute to the control and elimination of
present wastes and extravagances and toward maximum
practical effectiveness and efficiency in the delivery of
and payment for comprehensive health services of good
quality commensurate with our need and potential.

A Statement
Of Principles

The Committee For

806 15th Street, N.W.
Washington, D.C. 20005

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