Medicare and the Medicaid program. The following tabulation summarizes the operations of these programs. (All figures in millions.): Health benefits are provided to more than 2.3 million Federal civilian employees and their 4.8 million dependents under insurance programs managed by the Civil Service Commission. A similar program provides benefits for 215 thousand retired employees and their dependents. These payments are made from trust revolving funds combining the premium deposits of the agencies and their employees. Since these are revolving funds, with receipts offsetting expenditures, only the net effect of trust fund transactions is included in the total for this category. The Governments' contribution however, amounting to $170 million in 1966, $223 million in 1967, and $230 million in 1968 are included in this category. Medical research expenditures are estimated at $1,450 million or 12% of the Federal health expenditures. This category reflects the activities of many agencies, although the National Institutes of Health and the National Institute of Mental Health will spend $895 million or about 60% of the total Federal medical research effort. A comparison of current expenditures with 1960 graphically demonstrates the sharp increase which has taken place in the national medical research effort. Between 1960 and 1966 total national expenditures, both public and private, in support of medical research increased 150%, from $830 to $2,050 million. Projections indicate that a national level of effort approximating $2.5 billion will be achieved in 1968. Since 1960, Federal expenditures have risen from $444 million to $1,450 million in 1968. Health manpower training programs continue to expand, reaching $762 million in 1968. The Public Health Service will spend 65% of this total for the construction of nurse training facilities, schools for the education of doctors, dentists, and other professional and allied health personnel and for student loans, scholarships, traineeships, and institutional support. The 1968 programs will support, via loans and scholarships, 16,400 medical, 5,900 dental, 28,000 nursing and about 1,200 students in other health service professions. Other agencies having major health training programs are the Department of Defense ($75 million), the Department of Labor ($55 million), and the Veterans Administration ($39 million). Preventive and community services account for $820 million of total expenditures and are $369 million above 1966. An important change in the relation of Federal to State and community health programs will take place with the implementation of the Partnership for Health Act in 1968. This program will help the States develop integrated plans and programs combining services, facilities, and manpower in a concerted effort to solve high-priority health problems. In addition, it will substitute a new system of general support and project grants for a variety of categorical grants which have in the past fragmented the local system of health services. Aid to States and localities to control environmental hazards will also be expanded. Efforts to control air pollution, for example, will double in 1968 to a level of $50 million. Construction of hospitals and other health facilities will result in 1968 expenditures of $555 million, an increase of $113 million. Of this total, $235 million will be for the construction of community facilities supported through Hill-Burton program construction grants. Defense construction accounts for $55 million and VA construction for $77 million of the total. Table H-3. FEDERAL HOSPITALS, OPERATING BEDS, AND PATIENT LOADS Payments for health care services by population grouping.-Table H-4 distributes the estimated Federal expenditures for health care provided directly in Federal installations or via payments or grants for health care delivered by non-Federal facilities and medical practitioners--the sum of the first two lines of table H-2. As this tabulation represents the initial attempt at a population classification in this analysis, the figures should be viewed as trend indicators and as reasonable estimates. Table H-4. ESTIMATED FEDERAL HEALTH CARE EXPENDITURES BY POPULATION GROUPS (in millions of dollars) 1 Under proposed legislation for the disabled there may be a small but not significant number of children covered in 1968. The aged. Because of prior studies made by the Department of Health, Education, and Welfare, firmer estimates can be made of the total-public and private-expenditures for health care for the aged than for other age groupings. In 1968, total public and private health care expenditures by or for the aged are estimated at about $10 billion. Of this estimate, $5.3 billion will be derived from Federal programsprimarily Medicare which is estimated to spend $4.0 billion in 1968. This is a marked shift, as well as a significant dollar increase from 1966 health care expenditures on behalf of the aged which totaled about $7.5 billion, of which only about 16% were expenditures from Federal programs. In addition to Medicare, the other major programs which provide or pay for health care for the aged are payments to vendors under the Federal-State medical assistance program, and the VA programs for eligible veterans. In 1968 almost 60% of the total Federal payments for health care will be spent on behalf of the aged. Children and youth.-The rise in Federal expenditures for health care for this group, from $823 million in 1967 to $1 billion in 1968, stems primarily from expansion of the recently enacted Medicaid program which provides Federal grants to support State programs paying for the cost of care provided to needy individuals and their families. These expenditures are estimated at $221 million in 1968 compared to $123 million in 1967 and $21 million in 1966. The Neighborhood Health Centers and the Head Start program financed by ŎEO as well as special programs financed by the Children's Bureau also pay for health care services to children. The OEO programs rise $16 million over 1967 to $100 million; the Children's Bureau expenditures are estimated at $133 million in 1968, an increase of $29 million over 1967. Payments by the Department of Defense for servicemen and dependents under 21 rise from $417 million in 1967 to $453 million in 1968. Other adults. The 1968 expenditures of $2.5 billion tallied in table H-4 for this group reflects the predominant emphasis of Federal programs serving beneficiaries legally entitled to care in Federal installations or under Federal auspices. The programs pay for health care given to servicemen, veterans, Federal employees and their spouses, and represent over three-fourths of the total spent for nonaged adults. Federal grants to support the State medical assistance program for needy adults are less than 8% of the total. Other Federal programs that will spend more than $10 million in 1968 for health care for adults are OEO's Neighborhood Health Centers, the Vocational Rehabilitation program, and the maternal health programs of the Children's Bureau. The proposed extension of Medicare to cover the disabled will increase future Federal health care expenditures for adults in the 22-64 age group. Proposed legislation.-The President's 1968 budget proposes legislation to improve the health status of our Nation. It recommends extending the Medicare program to cover some 1.5 million disabled individuals. These people, like the aged, now receive monthly cash benefits from the Social Security and Railroad Retirement systems to replace lost earnings. Coverage under Medicare will extend to these people similar protection to meet the cost of health care. This legislation will also assure that payments made to hospitals for depreciation under Medicare will be used to replace facilities and equipment in accordance with State and community plans. In addition, the legislation will enable the Medicare system to reimburse Federal hospitals for services provided to its beneficiaries just as the system now reimburses State and local hospitals for similar services. The 1968 budget includes an increase of $200 million in payments from the Medicare trust funds to cover the costs of health care to the disabled and the reimbursement payments to Federal hospitals. The budget also includes expenditures of $33 million for proposed legislation designed to improve the availability and quality of health care to needy children, including dental care. Particular stress will be given to requiring periodic diagnostic screening and followup treatment in the Federal-State Medicaid program, and to develop methods which utilize more effectively professional manpower and medical assistants in bringing health care to children. Legislation also will be proposed to expand and strengthen the new Partnership for Health program. The 1968 budget includes expenditures of $20 million for this purpose. Finally, as part of a proposed revision of the Federal-State public assistance program, legislative changes will be proposed to modify the Medicaid program so that its beneficiaries relate more closely to the beneficiaries receiving support under the cash assistance program. 77-336 0-67- -13 |