OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE-Continued

IV. BENEFIT AMOUNTS-Continued

OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE-Continued

I. Purpose

11. Scope of benefits..

The new title XVI provides for Federal payments to States which institute programs to

make medical benefits available to aged persons of low income who are unable to meet the cost of their medical needs. Such benefits would be provided only in the form of direct

payments to providers of medical services. Federal payments to States would reimburse the States for a portion of their expenditures

under approved plans according to the equalization formula now used to compute the
Federal portion of old-age assistance payments between $30 and $65 per month, The
Federal share will range from 50 to 65 percent depending upon the per capita income of
the State as related to the national per capita income. As under the public assistance
program the Federal Government would bear half of the administrative expenses. (For

State matching percentages under public assistance (approximate) see p.-.)
In order to be eligible for such payments, the State must operate a program according to a

plan submitted to the Secretary of Health, Education, and Welfare, and approved by him,
which meets the requirements set out in the bill. The administrative provisions are
essentially the same as now required for State old-age assistance plans. The requirements
relating to medical benefits are outlined below. The Secretary may suspend payments
to States, in whole or part, when he finds that the State is not complying with its plan, or

that the plan no longer complies with the requirements of the bill. The State plan may specify medical services of any scope and duration, provided that both

institutional and noninstitutional services are included, and provided further that the medical benefits are not greater in scope, amount or duration than those available for oldage assistance recipients in the State. Moreover, the Secretary may not approve any plan which will result in a reduction in old-age assistance, aid to the totally and permanently

disabled, aid to the blind, or aid to dependent children.
The Federal Government would share in the expense of providing the following kinds of
medical services without limit:

1. Skilled nursing home services;
2. Physicians' services;
3. Outpatient hospital services;
4. Organized home care services;
5. Private duty nursing services;
6. Therapeutic services; and

7. Major dental care.
The Federal Government would share in the expense of providing the following medical
services up to the limits stated:

1. Inpatient hospital services-up to 120 days per year;
2. Laboratory and X-ray services (other than those included as inpatient hospital serv-

ices)--up to $200 per year; and,
3. Prescribed drugs-up to $200 per year.
The Federal Government would not share in the expense of providing the following kinds
of medical benefits:

1. Services not determined to be medically necessary by a physician;
2. Services rendered to patients in mental or tuberculosis hospitals;
3. Services rendered to persons in hospitals (other than mental or tuberculosis hospitals)

on a diagnosis of tuberculosis or psychosis, after the first 42 days;
4. Services rendered to inmates of public institutions (other than medical institutions);

and, 5. Any other type of medical service not mentioned above. The State plan must designate or establish an agency which will be responsible for setting

and maintaining standards for the providers of hospital, nursing home, and organized home care services. The plan must also include methods for determining rates of payment for institutional services, and methods for determining schedules of fecs or rates of payment for other medical services.

II. Scope of benefits-Continued

III. Eligibility for benefits.--

The State plan mot provide medical benefits to all persons who

1. Have attained age 65;
2. Have income and resources, considering their other living requirements, as determined

by the State, which are insufficient to meet the cost of their medical services;
3. Are citizens of the United States; and,
4. Are residents of the State (provision must also be made, in accordance with the Sec-

retary's regulations, which will make benefits available to residents of the State

who are absent therefrom). The State plan must exclude from eligibility for medical benefits all persons who1. Are receiving payments, or are having payments made in their behalf, under the

programs for aid to the blind, aid to the totally and permanently disabled, aid to

dependent children, or old-age assistance; or 2. Are under age 65. The State plan must contain provisions, in accordance with the Secretary's regulations, which

will make benefits available to residents of the State who are absent therefrom. The plan
may not require a premium or enrollment fee as a condition of eligibility. The State plan
must include reasonable standards for determining eligibility, but such standards may not
be inconsistent with the above requirements. The plan must provide that no lien may be
imposed against the property of a beneficiary prior to his death (or the death of his spouse,
whichever is later) on account of any benefit he may have correctly received, and that there
may be no recovery of any benefits correctly paid until after the death of the recipient (or

the death of his spouse, whichever is later).
Payments to State will first be made for calendar quarter beginning July 1, 1961.
Bill: Sec. 601.
House report: pp. 2-3, 6-9, 10-11, 129–135.
Authorizes appropriation of Federal funds to the States to make plans and initiate adminis-

trative arrangements for the new programs under title XVI. Such grants shall be made
upon application of the State agency, and may not exceed 50 percent of the cost of planning

with the further limitation that aggregate payments to a State may not exceed $50,000. Effective date: Date of enactment. Funds appropriated would be available for grants to

and obligation by the States through June 30, 1962.
Bill: Sec. 603.
House report: pp. 9, 136.

IV. Beginning date.

V. Planning grants.

PUBLIC ASSISTANCE

Item

Present law

H.R. 12580

No change.

1. Old-age assistance medi- The following formula is applicable for a com-
cal program.

bined program which includes both money
payments and vendor expenditures for

medical care.
A. Matching formula Federal matching share is $24 of the 1st $30

(% of the 1st $30) with matching above this
amount varying from 50 to 65 percent.
States whose per capita income is equal to
or above the per capita income for the
United State have 50 percent Federal
matching, while those States below the
national average have Federal matching
which varies up to a maximum of 65 per-
cent.