Medical appliances and the elderly, unmet needs and excessive costs for eyeglasses, hearing aids, dentures, and other devices


Material Information

Medical appliances and the elderly, unmet needs and excessive costs for eyeglasses, hearing aids, dentures, and other devices report
Physical Description:
xvi, 45 p. : ; 24 cm.
United States -- Congress. -- House. -- Select Committee on Aging. -- Subcommittee on Health and Long-Term Care
U.S. Govt. Print. Off.
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Publication Date:


Subjects / Keywords:
Aged -- Medical care -- United States   ( lcsh )
Medical fees -- United States   ( lcsh )
federal government publication   ( marcgt )
non-fiction   ( marcgt )


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Also available in electronic format.
Statement of Responsibility:
by the Subcommittee on Health and Long-Term Care of the Select Committee on Aging, House of Representatives, Ninety-fourth Congress, second session.
General Note:
At head of title: Committee print.

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University of Florida
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WM. RANDALL, Missour, ara
FRED B. ROONEY, Pennsylvania H. JOHN HEINZ III, Pennsylvania
IKE F. ANDREWS, North Carolina WILLIAM F. WALSH, New York
EDWARD P. BEARD, Rhode Island GILBERT QUDE, Maryland
DON BONKER, Washington
HAROLD E. FORD, Tennessee
ROBERT M. HORNER, Staff Diredr
LYLE McCLAIN, Coutnsel
MARTHA JANE MALONEY, Professional Staff Assistant
V. BERNICE KING, Fisancal ecretaryT


(WM. J. RANDALL, Missouri, Chairman of the full committee, and BOB WILSON, California, Banking
Minority Member, are members of all subcommittees, ex officio.)

WM. J. RANDALL, Missouri, Chairman
DON BONKER, Washington
THOMAS J. DOWNEY, New York HoaS, Minority Staff

CLAUDE PEPPER, Florida, Chairman
IKE F. ANDREWS, North Carolina H. JOHN HEINZ III, Pennsylvania
JAMES ?. FLORIO, New Jersey
ROBERT S. WEINER, Majority Staff
EIsOT STERN, Mi ority Staff
YosEF RIEMER, Research Assistant

I.i t '

EDWARD R. ROYBAL, California, Chairman
JosE S. GARzA, Majority Staff

SPARK M. MATSUNAGA, Hawaii, Chairman

EDWARD F. HOWARD, Majority Staff

Digitized by the Internet Archive
in 2013

To: Members of the Subcomittee on Health and Long-Term
From: Claude Pepper, Chairman. -
Re: Medical Appliances Report:
As part of its continuing examination of the health care problems of
the elderly, the Subcommittee on Health and Long-Term Care has
investigated the needs of the elderlyforhearing aids, eyeglasses, and
dentures as well as the high cost of these medical appliances. The
elderly of this nation are entitled to the best health care that is avail-
able in the United States. As this report demonstrates, in the area
of medical appliances, they are not getting it. There are two reasons:
The lack of federal assistance to help the ederly obtain desperately
needed devices and the lack of adequate safeguards to protect them
from abuses in purchasing these health aids.
An earlier subcommittee report, "New Perpectives in Health
Care for Older Americans," recommended that Medicare Part B
be extended to cover the cost of hearing aids, eyeglasses, and dentures
for the elderly. This report restates that recommendation and provides
further documentation of its urgeny.
This study is based on testimony presented to the subcommittee
at its June 23 and 24 hearings on "Medical Appliances for the Elderly:
Needs and Costs." Witnesses at the hearings included Mr. Nelson IH.
ruikshak, President of the National Council of Senior Citizens,
and Dr. Sidney Wolfe, Director of the Public Citizen's Health
Research Group. Other witesses included representative of the
Federal Trade Commission, the eterans Adminitration, the De-
artment of Health, Education and Welfare, -utual of Omaha
Insurance Company, Equitable Life Assurance Society, ?rudential
Insurance of America, Bausch and Lomb (eyeglass manufacturers),
the American Dental Association, the Lumiscope Corporation
(disbutoof home blood pressure monitoring ts), W. A. Baum,
Inc. (manufacturers of home blood pressure monitoring kts), and
the National Hearing Aid Society. Additional information has been
provided by the General Accounting Office, Carstenson and Asoci-
ates the American Speeh and Hearing Association, the Ebenezer
Society, the Sexton Dental Clinic, the New York City Department
of Cairs, the New Yor Consumer Serices Society, the
National Center for Health Statistiics, the New York Times, Geri-
trics Magazine, Money Magazine, Consumer Reports Magazine,
Moneysworth Magazine, Washingtonian Magazine, the Federal
Council on the Aging, the Hearing Aid Industry Conference, the
American Council of Otolaryngology, the National Association of
Blue Shield Plans, the Department of Defense, the General Services
Administration, the dian ealth Service and numers cogres-

sional committees and state health and related departments.
(V ,
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To all of these individuals, agencies, and grous, I sh to extend
my thanks. In addition, I wish to thank Mr. Bob Hoyer, Mr. Glenn
Markus, Mr. Herman Schmidt, Ms. Jennifer O'Sullivan, Mr. Edward
Klebe, and Mr. Henry Cohen of the Library of Congressfor providing
assistance at every stage of this udy.
Finally, I wish to commen and Yosef Riemer, research
assistant on loan to the subcommittee from Brandeis University, for
his invaluable assistance in te research nd preparation of this
rort. I would also like to thankD Marve Bernst, Prsident of
Brandeis University, for making Mr. Riemer availabl assist the
subcommittee in this important area.

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"They pay but not in dollars. They pay in the quality of life.
Some cut down on food requirements. Some go without the proper
type of shelter. Some cut off their social life. Many just do without
(eyeglasses, heing aids, and dentures) and fall back into more and
more seclusion and live a restricted life because these appliances
are not available to them as they should be."
President, National Council
of Senior Citizens.
"The only way out is to make impossible choices. It is impossible
for senior citizens to decide whether or not they want to hear what
goes on in the word or whether they want to eat."
Director, Public Citizen's
Health Research Group.

"If we are luck, we will all grow old. But how frightening to grow
old and not be able to see clearly, hear distinctly, or eat properly
because we cannot afford the necessary medical appliances to aid
our failing facilities."
American Dental Association.

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Meemorandum_ o r an_ dm _ ._ _ v .
ote ----....................................................... ----i
Summary of findings and recommendations---------------------------- x
Introduction --- -- -- -------- ---------. ---- 1
SChaptero ....................I-Vio........ 5
A. Need foreyeglasses 5
B. The present delivery system of glasses and its abuses............ 6
C. Costof eyeglasses...... 7
D. Coverage of eyeglasses under existing health benefit programs.- 8
Chapter I-Dent Care ..----------------------------------------- 9
A. Need for denture .....--------9--------- 9
B. The present delivery system of dentures ----------------------- 13
C. Cost of dentures ---------- 14
D. Payment for dental services under existing health benefit programs 16
Chapter II-Hearing Care --------------------------------------- 19
A. Need for hearing aid& ...-.-.-..--. ----- ------ 19
B. The present delivery and pricing system of hearing aids and abuses 20
C. Payment for hearing aids under existing health benefit programs__ 25
Chapter IV-Prostheti Devices and Other Durable Medical Equipment 25
A. Excessive medicare payments for overpriced pacemakers- 25
B. Unnecessary medicare payments for durable medical equipment
item- .-.-....-------------------------. -26
C. Home blood pressure monitoring kits28
D. Coverage of other durable medical equipment under medicare for
residents of institutions-- 28
Chapter V-Existing Contract Purchasing Programs: Examples of Federal
Assistance..------ 30
A. Veterans Administration contrat purchasing program ----------- 30
B. Department of Defense contract purchasing proram------------ 31
C. General Services Administration contract purchasing program.. 32
D. Other contract purchasing programs.----- 33
Chapter VI-Conclusins and Recommendations..---------------------34
........Glossary...... 45




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is dependent on one or more medical appliances. Presently the mas-.
hearing aids are unmet because, in many cases, the elderly cannot

gramshave provided only limited help in this area. The elderly who
are able to afford needed medical appliances are frequently the victims
of -abuses h as overpicing and unne cessy "ser es
More than 20 million elderly American require and own eyeglasses.
However, over five million elderly Americans are wearng glasses
which need "orrection (pp. 5-6). i
Seious evidence of abuse has come from a New York sirvey which
demonstrated that one out of five eye examiations given by optom-
etrists resulted in unnecessary prescriptions (pp. 6-7).
umerus surveys of retail firms selling eyeglasses are conclusive
evidenceof overp g. The surveys show a 200 to 300 percent
vriae in t ,e ot of iden l eyegl, 7).
Medicare does not cover the cosof ey asses or related exaina-
tions. Medicaid is only slightly morehelful, pa g for eyeglasse
for those elderly people who are eligible in only half tle states. Private
insurance companies rarely cover any vision care expenses (p. 8).
Dental problems, such as tooth decay and periodontal diseas
iaprad am g the eldl that hal of a persons over
have no natural teeth (pp. 10-711). 4 '
6.2 percent of those elderly people who are without natural teeth
also have no dentures. An additional 30 percent of those without
natural teeth do have dentures, but they are ineffective and require

The sbo ittee fund that identical dentures, including identi-
cal fitting procedures, range in price from $100 to $1,000, and con-
luded that this discrepancy in large partreflects overpricing (pp.

Medicae ers oy se d forms of d l srger, but not
cover dental care and dentures, but that number continues to decline
as many states strive to cut back their expenditures. While dental
insurance is the fastest growing line of private health insurance, den-
tal costsremains the least insred major health cost in the United
Morethan one half of all persons over 65 suffer from impaired
are unable to hear words spoken in a normal voice (pp. 19-20).
\ -y '.- *T .i


economic interests of elderly consumers. Studies have demonstrated
that the result of this system of allowing the hearing aid dealers,
rather than pysicians, to dtermine the need of elderly consumers
'* 1
for aids, is frequent recommendations by dealers for hearg aids that
cannot help buyers (pp. 21-22).
According to three different panels of hearing experts, the trainin
that hearing aid dealers receive is ttal inadequate. To compo
this problem, many states have no law which set up minimum educa-
tional standards that dealers must meet. M o have
these laws, but they are often ineffective and frequently lead to the
hearing aid dealers regulating themseles (pp. 22-23).
There is almost a total lack of oversight and scrutiny of the hearing
aid industry. The Subcommittee heard evidence fm the Federa
Trade Commission of numerous instances of misrepresentation and
anti-trust violations such -as price-fixing in the g aid industr
(p. 23).
The cost of hearing aids is excessively high (two and a half tiges
the wholesale price) and represents a formidabl ba rrier to those
elderly people who need the devices (pp. 24-25).
Medicare does not pay for hearing aids at all. Medicaid pays for
hearing aids for the elderly in only 11 states. Private health insurance
policies rarely cover hearing aids (p. 25).
There is evidence of significant overpricing of pacemakers. The
Public Citizen's Health Research Group has reported that the actual
cost of a pacemaker is "several hundred dollars." Yet, these pros-
thetic devices generally sell for $1,300. The Deparment of Health,
Education, and Welfare continues to ignore the overpricing and to
pay these unreasonably high prices to manufacturers for pacemakers
that are purchased by those eligible for Medicare. Pacemakers are
big business-endorsed for investment by a reputed Wall Street firm
because of 30-50% annual profit- despite Medicare requiremets
for HEW to reimburse only "reasonable cost." The subcmmittee
found that since Medicare pays for most pacemakers, patients and
doctors are not concerned with price, providing little if any incentive
for manufacturers to cut prices (pp. 25-26).
There is also conclusive evidence of the waste of 10 million taxpayer
dollars per year because Medicare allows excessive payments, as
opposed to cheaper methods of acquisition or leasing of qspital beds,
crutches, wheelchairs, and dialysis equipment, that are covered by
Medicare. Four years ago legislation was passed authorizing HEW
to take the necessary steps to end that waste. Yet, the Department
has progressed only to the point of conducting a "design of an expei-
mental concept" (pp. 26-27).
There is a serious controversy concerning home blood pressure
monitoring kits. Manufacturers of higher-priced mercuriai (ysing
mercury level to measure) devices claim that this tpe of device is
the only accurate way to measure blood pressure. On the other hJand
distributors ofinexpensive aneroid (using air presse) dvics argue
that this type of device, while not as accurate as a mrurial devic
is certainly accurate enough for home use since it mee th feder
accuracy standard of .3 millimeters. Thus, the aneroid distributors

argue that any di ence in accuracy does noQt justify the higher cost
of mercurial devices (p. 28).
An anomaly in wording of Section 1861(s), of Title XVIII of the

and other durable medical equipment to patients in skilled nursing
facies and reidents of intermedite care facilities while elderly
people livg outside these institutions do receive this coverage
Several existing government programs have demonstrated tha
by making use of volume contract purehasing of eyeglasses, hearing
id, and dentures, the costs of these appliances are owered by as
percent. e most extensive of these progrs p-
erated by the Veterans Administration. In 74, r example, the
VA purchased 13,700 hearing aids from 14 companies and provided
them to those eligible at a cost ofi $205 per hearing aid. This cost
has been confirmed by a General Accounting Office report and is $145
w the a e reil h ig aid st. Progr s operated y the
Department of Defense, General Services Administration, and the
State of Michigan are other examples of contract purchasig programs

levels (pp. 30- 33).

1. Meicare Part B should be extended to cover eyeglasses, atearing aide,
Sd dentures and related medica l care (pp. 34 : 36)
Because of the great need of the elderly for eyeglasses, hearing aids,
and dentures, asd because of the hardship that paying for these
e xpensive appliances represents to thp, the subcommittee considers
it essential that federal assistance be increased to meet those needs.

Tpr swittee, believesI that in the absence of nation al healthi

would be covered for 80 percent of the reasonable charges for these
health expenses once they had spent more than $60 in that year on
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done with the federal share of the existing edicare Part B program,
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all the fderal fnds would be paid fro general revenr to
protect the integrity of the Social Security Trust Fund. In addition,
it is important-to note that the cost of the federal share ad' of the
premiums would decline by as much as one billion *dolilrs a year
after the fifth year of the program since the enormous baklog of
elderly people who desperately need medical appliances will be
reduced by that time (p. 35). "' "
The subcommittee has found that the Medicare Part B extension
could be quickly implemented by making use of the existing Medicare
administrtive mechais. The additional coveragewud reprent
nio extra burden to these mecnisms (p. 35).
In addition, Medicare shoul be extended to cover oxygen tents for
all elderly people, rather than just those outside of d Iursg
Sfacilities or intermediate care facilities (p. 36).

eyeglasses, heaing aids, an dentures to the elderly, (pp. 8)
While it is imperative that Medicare benefits be tended, it is
equally imperative that the extension not be done in such a way
allow the inadequacies and abuses of the present delivery system of
medical appliances to ontinue. The subcommittee thus ecommends
that volume contract purchasing of eyeglasses, heari aids, d
dentures be utilized by the Department of Health, Educon, and
Welfare to provide these appliances to those elderly people who opt to
receive the Part B coverage. HEW should begin to experiment with
contract purchasing immediately. Within 5 to 10 years, it shuld be
the official HEW policy that contract purchasing be utilized wherever
feasible in the purchase of eyeglasses, hearing aids, and dentures for
those covered. The subcommittee also recommends that states con-
sider making use of contract purchasing of medical appliances as
part of ther Medicaid progrms. Existing governent contact
purchasing programs are conclusive proof that this recommendation
would result in a reduction in theactual cost of medical appliancs
from the excessively high levels of the present (pp. 36-37).'
Under contract purchasing, manufacturers of medical applices
would submit bids to the Deprtment of Health, Education, nd
Welfare. HEW would on the basis of competitive bidding, aar
contracts to selected manufacturers. The manufacturers would then
distribute the agreed on devicesto retail outlets. The retailers wuld
provide the health aids to those elderly people who have paid the
Sart B premiums and would receive reimbursement from Medicare
(p. 37).
1. A series of safeguards should be implemented to end abuses against
medical appliane ~consumers (pp. 38-41)
ecause of evidence of abuses and inadequacies in te present
pricing and delivery systems of medical appliances, it is urgent that a
series of major safeguards be enacted to pro tect eldeily onsumers from
the kinds of abuses that they suffer today Thus, the suommittee
recommends that the following safeguards be implemented by federal
and state agencies (p. 38):


The first of these necessary safeguards is continued and increased
scrutiny by the Federal Trade Commission and the Food and Drug
Administration. For example, the subcommittee calls for an investiga-
tion by the Federal Trade Commission of unreasonable charges in the
heaing aid, eyeglass, denture, and pacemaker industries (p. 38).
The second necessary safeguard is action by the states individually
and the Federal Trade Commission nationally to remove the bans
which bar price advertisements of medical appliances. According to
the FTC's Bureau of Consumer Protection, these bans "reduce com-
petition, restrict consumer access to information, and allow higher
than competitive prices to exist" (pp. 38-39).
The third safeguard is improved HEW actions to reduce those
Medicare expenditures which are excessive and unnecessary. First of
all, HEW should immediately implement leasing and other economical
methods of obtaining medical equipment. Legislation authorizing this
was passed four years ago. The subcommittee can see no reason for
the delay. Second of all, HEW should limit its payments for such
devices as pacemakers to "reasonable charges" and stop paying for
these devices when they are overpriced. Other HEW actions that are
needed to end abuses of Medicare covered medical appliances include
audits, on at least a random basis, of medical appliance manufacturers
and providers and the imposition of a uniform system of quick and
severe penalties for those manufacturers, providers and consumers who
defraud the publior Medicare in this area. Regulations are also
needed to protect the freedom of choice of Medicare recipients in
purchasing durable medical equipment. Finally, HEW requirements
are needed which would mandate css referencing of "prevailing
rates" (listing of prices by dealers in a given area) by all Medicare
Fourth, there is a parcularly severe need for additional safeguards
specifically directed at ending the inadequacies and overpricing of the
present hearing aid delivery system. These include Federal Trade
Commission regulations that would guarantee that hearing aid pur-
chasers have the right to return hea aids, end misrepresentation
in hearing aid advertising, and would bar high-pressure techniques in
the sale of hearing aids. In order to eliminate the widespread sale of

examined by a physician, preferably a hearing specialist before pur-
chasing a hearing aid. In other words, a physician rather than a hear-
The subcommittee thus believes that the regulation that has been
proposed by the FDA which would require only persons under the
age of 18 to have the examination, is not adequate. Finally, the sub-
committee believes that increased HEW assistance to encourage
continuing education and training programs for hearing specialists,
clinical audiologists, and physicians is needed in order to improve the
quality of the hearing care they provide. Similarly, state and local
public health departments should be encouraged to provide greater
hearing care to the elderly including a network of examination and
treatment sites (pp. 40-41).

t. All people purchasing eyeglasses, hearing aids, and dentures should
use consumer discretion to avoid abuses such as orpricing and
unnecessary services (pp. 41-4)
: .
The subco ittee recom ends that all people p a
appliances utilize consumer discretion to avoid overicing
essary services so that they will have eyeglasses, hearing aids, and
dentures of the highest possible quality and the lowest
The subcommittee has listed suggestions at the conclusion of the re-
port. In addition, where appropriate, the federal government the
regional and local authorities should disseminate such informati
(pp. 41-43).

S being mios f olde American is dependent on their
use of one or more medical appliances. Indeed, medical appliances are
ee elderly Amerins that it wuld be impossible
for them to have meaningful lives of the quality that they have become
accu to and thpt they deserve withot them. For example,
o elple without necessary he g ds, hearing loss
becomes a frustrating disability which interferes with voational activ-
ities and social interactions, thus, increasing the severe emotional
and social isolation that is associated with old age. Similarly, without
necessary dentures, older people lose their ability to chew and digest
foods that they desperately need to meet nutritional requirements.
Finally, without necessary eyeglasses, elderly people lose essential
Scontact wit the world around them and grow more and more
isolated from family and friends. In short, for millions of elderly
Americans, medical appliances are essential to life itself.
Because of the crucial importance of medica appliances, the Sub-
committee on Health and Long-Term Care believes that the needs of
medical appliances are not being met
. "
The smi has found that millions of elderly Americans
need medical appliances like hearing aids, eyeglasses, and dentures
but do not have beause, in may ase they cannot afford the
high costs of these health aids. These costs are an enormous burden
for all older Americans because they have, on the average less than
half of the income of their younger counterparts. It is a particularly
difficult burden for the one-third of the elderly bordering on or below
the poverty level. As Nelson Cruikshank, President of the National
Coni o eor Citizens, has pointed out, if eldely people cannot

Spay not in dollars They pay in the quality of life. Some cut down on
food requirements. Some go without the proper type of shelter. Some cut off their
social life. Many just do without (eyeg g aids, and dentures) and fall
backto e and more seclusion and live stricted life because these -
ances are not available to them as they should be.
Despite the fact that lae ns of e y people. cannot afford
-soy neither
the medical appliances that they so desperately need, neither vblic
nor private health benefit programs have been suffciently helpful to the
elderly in this area. Medicare, for example, provides no coverage of

Medicaid does cover some devices, but only for the poor of a small
number of states and.thus, it pays for only a small fraction of these
costs. Finally, private health insurance policies rarely provide cover-
age of medical appliances. The result of all this is that the elderly.

to afford to do so, in the words of Dr. Sidney Wolfe, Director of Public


Citizen's Health Research group, the only way out is to make i"-
possible choices. It is impossible fora senior citizen to decide whether
or not heywanttohear hat goes on in the world or whether they
want to eat.
The choices which senior citizens are forced to make about medical
appliances due to the inadequacy of health benefit programs are yet
more "impossible" because of the financial re that the elder
bear in other health areas. The cost that the elderly must pay for all
types of health care, not just medical appliances, continues to sky-
rocket. The average out-of-pocket cost paid by the elderly for health
care has increased from $178 in 1966 to $415 in 1974. This ncrease
occurred despite the Medicare program, which now pays a lower per-
centage (38 percent) of the- medical bills of the elderly than when
it began (46 percent).


Durable medical
Totals Hearing aids Dentures Eyeglasses equipment

Alabama --....-------. Not piovided.. Not provided-----.-. Provided with liits..-- Provided with limits.
Alaska.----.----.. -......--.--- .- ...- Do.
Arizona 1...................._......--...--...-..........
Arkansas..-...--.--. Not provided.- Provided with limits-.- Provided with limits .. Do.
California......----..... Providd-----....... do..........................---..... Do
Colorado -------.----.. Not provided.. Not provided...-------- . do,..----. ---..... Do,
Connecticut --.----- Provided-.--- Provided with limits-...--- do.---.---...-- Do.
Delaware---.....----.. Not provided..- Not provided Not provided.
District of Columbia---- do....... Provided with limits-.. --do..--. .....- Provided with limits.
Florida _------.....--------do..----. Not provided..-------. Not provided .....- Not provided.
Georgia--- --- ------- do.-----. Provided with limits..-- Provided with limits.... Provided with limits.
Guam------ ........ Provided...
Hawaii-...------... Not provided.. Provided with limits.... Provided with limit-- Do.
Idaho- ..---------...... do--....---. Not provided...-..-_- Not provided---... Do.
Illinois.......-- .---. Provided---... Provided with limits-..- Provided with limits.... Do.
Indiana..---...-------do--.. do ---....... Do.
Iowa -----. do .---------do-..-.. Do.
Kansas.----------do.--.. Provided no limits.-------. do .....-------------......... Do.
Kentucky.--..------. Not provided.. Not Do.
Louisiana----------.. Provided.. --- ----do--.... ..------- do.----..... ----. Do.
Maine-..--........ -Not provided.. Provided with limits..-----.. do.---.----. Do.
Maryland --------- -- do---- ---- Do.
Massachusetts--- .- Provided...-- --_--do-- ------ Do.
Michigan.....---- ----. Not proided.... .do------ Do.
Minnesota..--------.. Provided no limits.
Mississippi.....------- Not provided.. Not provided-..--------... do-----. ..-----. Not provided.
Missouri ...-----... --.-- .do ------ Provided with ...Do.
Montana---....------. Provided.------.. do .----.---- .do-.- .---..--. Provided with limits.
Nebraska do_.---------- do .--.--------. Do.
Nevada _--- .-----.. Do.
New Hampshire--------........ do---...... Not provided--...... Do.
New Jersey..------... Not provided.. Provided with limits...-----.. do..----------.. Do.
New Mexico-...-------. Provided...----- do -- ---- ------do---------..----- Do.
New York --------.-------... do-. --.----. do -------------do------------- Do.
North Carolina..--..---. Not proviJed.- ---do----- ....------- do.-- ----. ---. Do.
North Dakota --------. Provided...-- Provided no limits .... Provided no limits.---. Provided no limits.
Ohio-........- --- do-...... Provided with limits.... Provided with limits.... Provided with limits.
Oklahoma--...-------.-- Not provided..- Not ...........Do.
Oregon-------..........----- Provided..---- Provided ----------.... Provided..---------.. Provided.
Pennsylvania ---- Not provided Provided wi limits Provided wit limits P.ided ith liits- Privided with limits.
Puerto Rico---.....-----.. do .----.--- Not provided.-----... Not provided .-------. Not provided.
Rhode Island----- Provided ..-- Provided wi limitswith l imit s ith limlts-..- Provided with limits.
South Carolina.---.... Not provided.,. Not provided-..-- -------. do...---.--..----. Do.
South Dakota.....- ----do--. -,-----do.---------..--......... do ..-----._-----_ Do.
Tennessee.-... ---- do- .Provided with limits.--...- ---. Do.
Texas .......... -------------do .do ......------. Do.
Utah........----------. Provided......--- do .----- --.-------- do ........------- Do.
Vermont- Not provided.-----..- Not provided...---- Provided no limits.
Virgin Islands....---..---.... do .---.. Provided with limits-..- Provided with limits..-- Provided with imits. Not provided Do.
Washington ..---. -----... .. do.--- --Provided with limits...---.. o.. o... ------ Not provided.
West Virginia--........-----do...------.. do.---_ -d.--- -- do.- ---. Provided with limits.
Wisconsin Provided no limits...- Provided no limits Provided no limits.
Wyoming...----....... Not provided. Provided with limits- Provided with lmt rovded with limits.

i Not applicable.

To make this situation yet worse, the elderly who are able to afford
needed medical applicances are frequently the victims of abuses such as
overpricing and unnecessary services. In the hearing aid industry, for
exampl there is conlusive evidence of misrepresentation, restraint
of trade, price fixing, inadequate training of dealers, and ineffective
licensing laes. Throughout the medical appliance area, the lack of
standardization makes it difficult for older persons to make price
comparisons between products. Also, the elderly often rely heavily
on the advice of the medical equipment supplier in the selection of a
particular item and the supplier may have little training and a strong
interest in maximizing profits.
Thus, there are two key inadequacies in the present delivery system
of medical appliances to the elderly; high prices which keep people
who need the devices from having them and widespread abuses
against those who do purchase the devices. Clearly the time has come
for increased federal assistance in this crucial area. This nation cannot
continue to ignore the need of the elderly for high quality medical
appliances at prices that they can afford. The people of this country
cannot sit idly by as the cost of health care that is paid by the elderly
continues to reach higher and higher levels. In short, the time has
come for this nation to move ahead and provide more of the essentials
of life to the elderly.
The subcommittee believes that extending the optional Part B section
f Medicare so that it would cover the cost of hearing aids, eyeglasses,
and dentures is imperative in attmpting to solve the problems of the high
t paid by the elderly for health care in general and medical appliances
in particular. Yet the subcommittee emphasizes that any such in-
crease in federal assistance represents only part of the solution. While
it is necessary that Medicare benefits be extended, it is equally im-
perative that any extension of benefits that is made not be done
in such a way as to allow the inadequacies and abuses of today's
delivery system of medical appliances to continue.
For this reason, it is essential that two major reforms accompany
the extension. First of all, the government should utilize large volume
contract purchasing of eyeglasses, hearing aids, and dentures, as the
Veterans Administration andother agencies now do, thus reducing the
cost of medical appliancesfrom the excessively high levels of the present.
Second of all, a series of major safeguards are needed to protect the
elderly consumers from the kinds of abuses that presently dominate the
market. The subcommittee, based on its investigation of the needs
and costs of medical appliances, believes that the extension of Part B
of Medicare so that it would cover hearing aids, dentures, and eye-
glasses, the use of contract purchasing, and the institution of safe-
guards are all desperately needed by the elderly. The subcommittee
therefore believes that legislation to accomplish these ends should be
enacted by the Congress.
Finally, in considering these issues, the subcommittee believes
that it is especially important that the American people and the
American Congress bear in mind one crucial idea; the most important
level on which these roblems and recommendations can be considered is
the human level. This report should be viewed as a discussion of the
crucial needs of people and not a collection of statistics with no
meaning. In human terms, the high cost of medical appliances and


the widespread abuses mean that many of our 22 million elderly
segment of the population, are now suffe g ts hashis.
As the following remark by Doctor Rbert Lytle of the Amran
Dental Association demonstrates, en these hardshi are looked
at on a human level, it becoes cle that we t do we can
to answer the needs of the elderly and to end the abuses that they
now suffer in this area.
If we are lucky, we will all gow old. But how frightening to grow old and not be
able to see clearly, hear distinctly, or eat properly because we cannot afford the
necessary medical appliances to aid our failing facilities.


need of our nation elderly for medical appliances and e adequacy
of the existing pricing and delivery systems at meeting that need. The
size of thatneed becomes evient with an examination of the following
pairments more frequently than from any other ailment except
arthritis. Second of all, since vision deteriorates with age, there are
more of eye problems among the elderly than any other segment
of the population. At the present time, over 20 million Americans over
65, or 92 of our nation's elderly require and own eyeglasses or contact
lenses. Over 5 million of these people need new corrective lenses
because the ones that they now have either do not help their sight or
actually harm it.Countess additional elderly Americans need eye-
Snot ha te. This vast need for proper glasses is
especially critical because many eye diseases, such as glaucoma and
senile catarats can lead to blindness if they are not detected and
tread prom S e the rate of bl ess aong Americans over
65 is over eight and one half times as great as the number in the
under 65 population, it can be concluded tat these crucial vision needs

ported conditions ranged from 1 per 1,000 persons to 187.5 persons
thr of the country the reported prevalance te South
was 249.5), among the elderly in nometropolitan areas, and among
t d d e require correction as they deteriorate
h aece sion, while only 19.6 percent of the
tion ave 207 uncorrected vision or worse, 51.8 percent
of people 65-74 and 55.5 percent of persons 75-79 years of age have
correc vision or worse. Similaly, where the vision is
corectd with eglasses or ntact enses, the number of persons in
the general pop tion with /70 vision o worse is 3.2 percent, where-
as for persons 65-74, the percentae is 10.1 and for persons aged 75-

For near vision the situation is worse. Over 35 percent of all persons
have uncorrected vision of 14/49 or worse. For persons aged 65-74
the figure is 858 percent. For corrected near vision, 6.3 percent of the
f 14.4percent of the
65-74 age group and 26.9 percent of the 75-79 age group had near

SSince less than one rent of all Amerans over 65 wear contact lenses, this report

iili iliii IA


According to the National Center for Health Statisti e mi
elderly pele are eari gla wi need c
cases, elderly people have glasses which are so inadequate that they not
only do not help them; they may actually harm their vision. A survey
of elderly popl who wear glasses conducted by the National Center
for Heath Statis provided dumen is
Forty-four percent ofe estance with and without
their asses. This rep wh stated they wore
for distance vision. Glases improved acuity fr 76 percent, while 19.prcet tested
the same with gl as without, and five percent did better without glasses.
Over half o the exminees (52 percent) were tested both wth a wi thout
glasses for near vision. (An additional four perent stated for
near work but did not bring themto the examining center.) Of t with
glasses or contact lenses, 83 percent had improved acuities with correction, 14
percent were unchanged, and three perent did less with than ithout their
Finally, while no data is available, the subcommittee believes that
in addition to the five million people who have inadequate glasses,
countless more elderly people need glasses, but simply cannot ord to
purchase them.
In many cases, the consequence of not having proper glasses is tat
elderly people are mistakenly believed to e senile when i actuality
they are simply unable to see necessary stimuli. A study by the
Ebenezer Society a leading Geriatrics Center in Minneapolis, Minn.,
has confirmed that in many cases, older persons may "have been
inappropriately labeled mentally impaired as a result of unresolved
vision needs."
The subcommittee has found serious evidence of abuse of the rights
and trust of consumers in the present delivery system f eyeglasses in a
New York Department of Consumer Affairs survey. The study
indicates that one out of ive eye examinations gwive to their own in-
vesigators (posing as typcl consumers) by optomerits resulted in
unnecessary prescriptionsfor eyeglasses. In additionto raisin questions
about the ethics of some of the surveyed optomet ists, t lge num-
ber of unnecessary prescriptions demonstrates the need for minimum
requirements for examinations. The latter conclusion is based on the
fact that, in the survey, the optometrists who performed the least
adequate tests generally were the ones who gave the incorrect
In the study, eight Department of Consumer Afis (CA) staff
investigators who did not need new glasses went to ptometric estab-
lishments selected at random throughout New York. The investiga-
tors requested routine vision exams and did not cmplin of any
symptoms. Needless to say, the investigators answered any questions
that they were asked during the examinations truthfully. If the
optometrists said that they needed eyeglasses, the investigators
purchased them. The glasses were then examined by two DCA
consultants who compared the investigator's vision with te pre-
scribed lenses. They found that "erroneous prescriptions for unneeded
eyeglasses were given by 11 of the 16 surveyed optometric establish-
ments in 22 out of a total of 111 examinations." The following repre-
sents one example of the prescription of unneeded eyeglasses that
occurred in the study:


trist he was told that he had 20-20 vision. The investigator stated that "after the
optomet shone a small flashlight into my eyes he iformed me that my eyes
were sensitive to lght. He implied that this was an abnormal condition and told
me that I needed dark glasses to correct this." The optometrist told him to select

he had to purchase the glasses because the doctor said that he needed them and

One reason why so many unnecessary prescriptions were made in
the stud was that many of the eye examinations were made under
inadequate conditions. For example, in 17 of the examinations, the
optometrists projected improperly focused eye charts, so that those
tested were unable to se the chart clearly. In 21 other cases, the
lighting in the testing room was too bright for the chart to be read
correctly. n most ses, these inadequate tests were the basis for
prescriptionor eyeglasses that were in fact unnecessary.

Information received by the subcommittee, as well as a survey
conducted by the subcommittee, have resulted in serious evidence of
massive overp ing and enormous variance in the cost of eyeglasses.
For example, the New York Consumer Service Society reported that
"New Yorkers who purchased eyeglasses paid two and a half times (or
250 percent more) in one place as in another for the same set of com-
monly prescribed lenses in a standard frame." Virginia Iong, the New
Jersey Director of Consumer Affairs has charged that in her state there
is a 300 percent variation in the cost of the same eyeglasses.
In order to confirm these reports, the subcommittee conducted a

Washington area. The firms provided the following prices for their
least expensive eyeglass frames and the least expensive plastic and

Frames pair pair Col. 2 col 3

Firm C17.50 25.00 27.50 4250 45.00
Fi 8.95 14.95 19.95 23.90 28.90

200 percent variance in the cost of the identical eyeglasses with plastic

The subcommittee believes, as does the New York Community
Service Society, that "Price variations of this magnitude cannot be
explained away by differences from frm to firm in merchandise
quality, overhead and wholesale costs."

Medicare covers virtually no optometric services. The 1967 Social
Security Amendments excluded coverage of "eyeglasses, eye examina-
tions for the purpose of prescribing, fitting, or changing eyeglasses,
or any procedures performed (during the course of any eye examina-
tion) to determine the refractive state of the eyes."
Medicaid does provide coverage of the diagnosis and treatment
of eye conditions. In addition, many states provide optometric serv-
ices. For example, as of August 1, 1975, 15 states offered optometric
services to people receiving federally supported financial assistance.
Twenty-three more states, in addition to offering optometric services
to these categorically needy people, also offered such services to the
medically needy, people in public assistance and SSI categories who
are financially eligible for medical but not for financial assistance.
A number of state Medicaid programs do provide eyeglasses to the
needy. Eleven states offer eglasses to the categorically needy and
25 more states also offered eyeglasses to the medically needy.
The tragic aspect is that given their very limited financial resources,
states have been forced to cut from the Medicaid program desperately
needed optometric services and eyeglasses. Other states have not
dropped these services but have limited their coverage of vision care
by imposing such restrictions as requiring copayment and providing
eyeglasses and optometric services only to children. Other restrictions
have included a limit on the frequency of obtaining new prescriptions
and eyeglasses and the amounts paid for eyeglasses, and the frequency
of refractions and dispensing eyeglasses.
In Michigan and Georgia, for example, optical services are pro-
vided to children only. The Texas Medicaid program provides only
one pair of eyeglasses for a 24 month period, with certain qualifica-
tions, and limits refractions to once every year. In Maryland, different
limits are imposed for children and adults, with children allowed
to obtain new prescriptions more frequently. Maryland allows no
replacement for lost or broken glasses. According to the acting director
of the state Medicaid program in Michigan, costs for eyeglasses are
limited to the following amounts in that state; $35 for single vision
glasses and $50 for bifocals and trifocals. In the District of Columbia,
the Medicaid program pays the dispenser his wholesale price plus
$10.50 as a dispensing fee. There is a dollar limit of $5 for plastic
frames and $7 for plastic and metal frames. There is no limit on the
price of lenses, which are purported to average about $12. The Texas
Medicaid program uses a similar approach with some variations.
Other states, such as Virginia, charge the patient $2 for a pair of eye-
glasses, and $2 for any repair costing more than $5.
Health insurance policies are even less helpful to the elderly in need
of vision care than Medicare nd Medicaid are. Such policies rarely
cover any vision care services, according to the testimony before the
Subcommittee of the nation's leading health insurance companies.

4;i ;

e entulous without any natural tee). Whle a
majorit of these people do have the dentures that they requir-d, the,
inadequacy of the present pricing and delivery system of dentures
grams intended to meet such problems
is revealed in the fact that according to the National Center for
Stti 6.2 cent have neither natural teeth nor dntures
and 30 percent have dentures which are ineffective and. which require
refitting or replacement. Additional proofof this inadequacy is the
fact that the elderly, the population segment which most needs dental
care, receives less dental care than the rest of the population. Fre-
quently, this is due to the elderly being unable to afford the cost of
tal care. These dental car problems ae very serious for two
The rst reason is that persons who are without dentures for
too long a time after they have had their teeth removed, may never
be able to dentures when they do get them. The second reaon
at the ack of teth or the use of faulty dentures frequently re-
sults in changes in food selection due to chewing difficulties, and these
changes can cause nutritional deficiencies.
y the time person in this country reach the 65 to 74 age group,
Sro y 23 of their teeth are sing, decayed, or fied.
The following table, which was compiled y the National Center for
thSt csshowstheof decayed, missing or filled teeth
among all ults in the United Sttes.



Tota, 18 to 79 years 17. 1.4 9.4 7.0
Totalf, 18 to 79 years- -- -- --- -- -- 17.2 1.5 9.2 6.5
18 to 24 13.4 2.2 4.6 6.6
25 to 34 years 15.8 1.8 6.2 7.8
;135 to 44 years...... 17. 2 1.3 8. 1 7.8
45 to 54 years- --- 18.0 1.3 10.9 5.8
55 to 64 years 20. 4 1. L 14.7 4.6
* 65 to 74 y_ e s22 3 .8 18.1 3. 5
75 to .,79 years--..- -.- -.... 24.4 .7 21.7 2.0

T l 18 to 79 years 18.5 1.4 9.6 7.5
I -- I10 7,2*1'

18 to 24 years ... -- 14.1 2.0 5.0 7.2
25 to 34 years -- --. ---------- ------ -- -- -- -- -- 17.5 1.6 7.5 & 4

55 to 64 years 21.9 .8 14.8 6.3
St 7 y-------- -------- 22.8 16.8 5.5
75 to 79 years.. ........ ------ 25. 20.1 4.

.filled teeth with carious lesions or defective fillings. Missing teeth include both missing and nonfunctional teeth. DMF is

78-386 -76
ABLf Mi -- 1 *'

toh i r nu t h uh cr fh r
^-iuii fl^^MM~f^H^MMB^~~l^WMU i|^Ifi1j M ^J^M;W^E7 M^wz M-a~r'^1 ~wIW'^ pp l^
-~~~~~~~~~~~~ -' .' If ' " ^ ._j i1
f Isifr' daS: iC~l;~


In addition to the problem of tooth decay, periodontal disease (a
disease which affects the bone and tissue tht t te teeth) is
endemic among the aged. Like tooth decay, the prevalence of perio-
dontal disease rises sharply with age, as can be seen from the following
table which was compiled by the National Center for Health Statistics.


Status of periodontal disease
Without With periodontal disease
periodontal -
Sex and age Total disease Without pockets With pockets

Total, 18 to79 years---..--............ 100.0 26.1 48.5 25.4
Total, 18 to 79 years.------------------. 100.0 20.9 49.0 30.1
18 to 24 years..-----------------.... .----.. 100.0 29.0 60.6 10.3
25to 34years .---. ---..-- .--------------- 100.0 26.3 51.7 22.0
35 to 44 years-..---........ --...--....... 100.0 22.1 48.1 29.7
45 to 54years..-----.. ---... ------.... ... 100.0 15.0 48.1 36.9
55 to 64 years..------.................. 100.0 15.3 39.1 45.6
65to 74years....----....--------..--.. . 100.0 5.6 36.0 58.4
75 to 79 years..--... --.-............... 100.0 6.2 33.7 60.0
Total, 18 to 79 years.....----.---............ 100.0 31.0 47.9 21.0
18 to 24 years ...--.....----............ 100.0 36.8 53.6 9.6
25 to 34 years.............------------- 100.0 37.6 50.2 12.3
35 to 44 years...------.... ---...--......... 100.0 33.3 46.2 20.5
45 to 54 years...............-.....----.--. 100.0 26.6 43.7 29.6
55 to64 years....---.....----.--........... 100.0 20.8 43.6 35.5
65 to 74 years ..------------.-- ---......... 100.0 15.2 52.0 32.8
75 to 79 years ..--..--------.----... ..-..-- 100.0 11.0 35.3 53.8

The National Center for Health Statistics attempted to measure
the severity of periodontal disease, in addition to its prevalence. The
following table demonstrates that the severity of periodontal disease
(measured by the periodontal index) also increases with age.


Sex and age All races White Negro

Total, 18 to 79 years....-------.. ---..---.....-----....... 1.13 1.06 1.60
Total, 18 to 79 Years...............--- ------.... ---------- 1.34 1.28 1.79
18to 24years-----....----------.....--..-- ------...---..... .62 .58 .78
25 to 34 years ...-------..------..-----------------.. .- 92 .87 1.30
35 to 44 years ..............---------.........----..--..... 1.27 1.22 1.67
45 to 54 years ...................................---------... 1.62 1.55 2.06
55to64years..---....-----... ----------...----....----...... 2.15 2.00 3.13
65 to 74 years...---.----.---.--...---------.--------...-----. 2.50 2.47 2.83
75 to 79 years-...-----. .------------.--------------. 2.91 3.01 2.16
Total, 18 to 79 years..........-- --...... -----...........- .93 .85 1.43
18to 24years -..--............-- ---------------------------- .48 .46 .62
25to34years..---,--........... -----........................... .60 .53 .95
35to44years--...... .---..........-- ------- ----. .82 .74 1.30
45 to 54 years.. -- -------------------------------------- 1.23 1.11 1.92
55 to64years....-- ...............-----------------------1.56 1.39 2.90
65to 74years -----------........... ------------------------.. 1.62 1.51 2.03
75to 79 years ...------------ ---------------------- ----2.94 2.41 5.53

11,4 000 Americans o the age of 65 are edentulous as a result
of tooth decay and periodontal disease. This igure represents 45.2
percent of persons 65 to 74 and 59.8 percent of people over 75. The
reason for this high rate of edentulousness is that the senior citizens
of the peset grew up in a time before the benefits of flouridation
and ther preventive measures were known. In other words, the high
rate of edentulousness of today's elderly exists because extraction of
teeth, whh today is a last resort in nearly every instance, was far
more common in the pas when alternate tooth-saving procedures
were not known. Thus, many of the dental problems which are so
very acute among today's elderly, will become less serious among the
elderly of the future. For example, data published by the National
Center for Health Statistics demonstrates a significant decline in the
number of edentulous elderly Americans from 1958 to 1971. As the
following table indicates, for those between 65 and 74 there was a
decline of 10 percent, while for those over 75 the decline was 7.5
1958 AND 1971
July 1957- July 1957-
Sex and age June 1958 1971 Sex and age June 1958 1971
T SEXES 35 to 44 years----......... 8.8 8.2
45 to 54 years---..---...- 21.9 16.5
..All age .------- 13.0 11.2 55 to 64 years.-------... 35.9 30.5
Under 15 years. --__-.--.....--......... 5 to 74 years---....----- 52.8 45.0
1 *to 24 years. .9 .3 75 years and over-........ 62. 4 56. 3
25 to34years......... ----------- 3.6 3. 6
35 to 44years------------ 9.6 9.3 FEMALE
45t54 years ......- 22.4 17.3
55 to 64 yars------------ 38.1 30.8 All ages .---------- 14.1 12.2
65 to74 year-- ---------- 55.4 45.2 Under 15 years........................ .........
ears and over ...... 67.3 59.8 15 to24 years_------___. .9 .3
25 to 34 years-- --------- 4.5 4,0
MALE 35to 44 years------------ 10.3 10.4
45 to 54 years_- ..-..---- 22.8 17.9
I A ags--as .--- .....11. 9 10.1 55 to 64 years_----____-__ 40.1 31,1
Under 15 years------............ .....65 to 74 years-------. 57.6 45.4
15 to 24 years--.-_ .9 .3 75 yearsand over--.... 71.0 62.2
25 to34 years..------- .. 2.6 3.2

Additi l atistics fro the American Dental Association demon-
s s decline will ntinue. These figures show that the
rae of edentulousness is steadily declining among the younger age
s that w mke the elderly of the future. For example, a
190 survey inicatdd ta 31 percent of those between te ages of
30 and 39 were already wearing dentures or bridges. A, 1975 survey
indicated that the figure has dropped to 11 percent.
Sthe 11.4 milion elderly Americans who are without natural
tr fr ealth Statistics has reported some
shocking statistics. F, 600,000 elderly Americans are without
an ; thy ve neither natural teh nor dentures.
Second of all, 350,000 edentulous people over 65 had dentures which
were incomplete. In addition, the Deprtment of Health, Education
and Welfare has reported that almost one-third of the edentulous
elderly, or 3.4 million people, have dentures which need to be replaced
or refitted. With this in mind, it comes as no surprise to learn that 1.3
ilion people over 65 bhad so much difficulty wearing these inadequate

time. The large number of persons in need of dental care because


they have dentures which are so inadequate that they have difficulty
wearing them, points out a special problem of the aged According
toanarticle by
The average denture patient has a sore mouth, dissatisfaction with his chewing
Many elderly persons have given up with eir and use them
only for appearance in social situatio Although temporary m b
obtained by use of denture adhesives, it is very short lived and denture werers
find these powders and pastes literally distaste fl.
The seriousness of this problem should not be underestimated, for
in addition to causing soreness ill fitting dentures have even in m
instaces, caused cancerous lesions, according to Dr. Friedman.
All of the above statistics havedeonstrated tht elderly have
severe dental care proble ; problems which are the results of years
of inadequate dental care and which are much more serious than
those of the population as a whole. Thus, it is particularly shocki
to discover that elderly people use considerably fewer dental services
and see dentists 33 percent less freuently than other segments of the
population as the following chart indicates:
Percent of population with Number of dental visits per
dental visit within a year person per year
July 1963- July 1963-
Characteristic (age) June 1964 1969 June 1964 1969

All persons-----....... ----............ 42.0 45.0 1.6 1.5
Under 5 years-........ ---..------,--.... 11.1 11.0 .3 .3
5 to 14 years-..-..----------.. --- 54.9 58.8 1.9 1.8
15 to 24 years...-...............- -----..... 55.1 55.6 2. 1.7
25 to 44 years....................... 48.5 49.5 1.9 1.6
45 to 64 years--....-----.. --.--------..--........ 38.4 42.3 1.7 1.6
65 years and over....... ................ ... 20.8 23.2 .8 1.0

The American Dental Association has provided information to the
subcommittee which shows that 71.8 percent of the edentulous
elderlypopulation has not even visited a dentist within the past 5
years. While in some cases this statistic reflects the fact that these
people do not require the care of a dentist, in many ases it is simply
due to the fact that elderly Americans, frequently poor and on fixed
incomes, have ignored their need for proper dental care because
of their lack of money. That millions of poor elderly Americans are
neglecting their dental care needs because of the high cost, is apparent
from the following table, which illustrates the fact that persons over
65 with incomes of less than $3,000 visited the dentist only one fourth
as often as elderly people with incomes in excess of $15,000.
One reason why it is extremely important that elderly Americans
receive the dental care that they require is that persons who are
without dentures for a long time after having their teeth removd re
frequently unable to wear dentures when they finally do get them. I
the 1950's, an experimental program was undertaken to provide
dental care in the Kansas City metropolitan area for the chronically
ill and aged. The program's dental staff found that persons who had
been without dentures for 6 or more years could not be fitted for


were considered borderline. Those tted for dentures ithin 5 years

A second reason why it is extremely important that elderly Ameri-
cans receive the dental care that they require is that the lack of teeth
or the use of faulty dentures frequently means that an elderly person
may be forced to choose foods that are easier to chew but lower in
nutritional value. Edentulous people with faulty dentures or without
any dentures tend to avoid foods like meats, raw vegetables, and
fruits because of the difficulty in chewing them Yet, these
foods are essential dietary ingredients for the elderly. For example,
d (ta ) is parti y necessary to assure wound

unusual for the elderly to have low intakes of the citrus fruits and
h v tabs wich e the natral souces of vit in c. A study
by the American ental Association has confirmed the severity of
this problem. The study showed that those peple with the least
wl w e ae to consume the lrgest amounts of each
of the nutritionl elements. in short, edentulus people require high
lity dentures in or avoi dietary imbalance, borderline
nutritional deficiencies, and even malnutrition.

live in areas i which there is ady aces to dental care services,

d 60 Whereas the nuber of physicians
per 100,000 increased from 136 per 100,000 in 1960 to 154 per 100,000

Welfae hats to 55.6 per 100,000 in

a 12 percent increase
1970 AND PROJECTED 175 AND 198
Changes in supplyJan -Dec. 31
Losses from
Year Ja I Net gains additions retirements Dec' 31

19... .70.. - -.-.- .-. -102,220
1980-- 123,200 2,970 5,370 2,400 126, 170

While the projected increase in the supply of dentists is relatively
modest, the Department of Health, Education, and Welfae has pro
Sfr greater increases in the supply of aied dental workers.
i* + H^B .ij
as.. :+ +
; i4,; + +++- ++ T +++ ++++ +
++ o +

1970; PROJECTED 1980
[Basic educational preparation less than baccalaureate in level
n : i*,,, i .. I i J, .'

Number of active formally
Occupation 1970 1980 19
Dental ist........-. ...........................-. 00 39,110 i 325.1
Dental hygienists -------....----.................................. 15,100 34,10 126.
Dental laboratory technicians --------------------. 1,600 7,070 341.

As can be seen, it appears that allie dental workers are being
substituted for additional dentists, because of the large number of
dental services that can be delegated. Since 1967, the number of
patients seen per dentist has increased by 12 percent. A 1970 study
showed that a dentist working with e assistant could be 36 percent
more productive than one working alone, and five assistants could
make a dentist 236 percent more productive. To some extent, how-
ever, such increases in productivity are limited by State laws that
specify the duties which can be delegated by dentists. Since 1970
states have been active in amending dental practice acts to allow
dentists to delegate duties to dental auxiliaries. In a report prepared
by the Division of Dentistry of the Health Resources Admimstration,
it was noted that the number of states allowing the delegation of
duties to dental auxiliaries increased from 24 to 44, or from 47 percent
of the states to 86 percent. The extent of delegation allowed tends to
vary with the states.
In addition to the dentist who takes the X-rays, makes the extrac-
tions and impressions, and works with the aged person to determine
the best possible fit, there are a large number of persons and organiza-
tions who participate in supplying the elderly with dentures, inclu
the manufacturers who produce the teeth and the supply houses who
distribute the teeth and other materials to the laboratories.
The cost of dentures, like many other professional services for the
elderly, varies widely. The cost, which includes the extraction of
teeth, X-rays, the making of impressions, and the purchase of the
dentures from the laboratory can vary from less than $500 to over
$1,000 depending upon the dentist. However, the existence of a num-
ber of large climes specializing in dentures which provide the exact
same services for as little as one fifth of these costs, represents evidence
of overpricing.
The Sexton Clinic in Florence, S.C., for example, provides dentures
for substantially less than the average cost of $500 to $1,000. The
following costs charged by the Sexton Clinic were provided by an
employee of the clinic to the subcommittee.
1. Extractions-$3 per tooth (medication such as anticoagulants
is additional).
2. Dentures-$50 (one style only which are made of acrylic).
Teeth are extracted and dentures fitted on the sam dayat the
clinic. The procedure begins at three o'clock in the morning and is
over at approximately seven o'clock the same evening. All work is
done by appointment. Many of the persons using the clinic are elderly
and travel from retirement areas such as Florida to take advantage


tethextrate teeth put in
at the Sexton Clinic. The clinic operates to motels for those people

While the subcommittee has seen no basis for any such complaints,
the South Carolina Dental Association, representing local private

W-- +
dentists, has been openly critical of the clinic andi has alleged that
they have received numerous complaints from patients of the clinic.
Additional evidence of overpricing of dentures is the fact that the
actual cost of the teeth and other materials which go into the making
of dentures, represents no more than 5 to 10 percent of the costpai
e atient for s or hr dentures In mst cases, 75 percent of
the final fee goes to the dentist for his services while the remainder

There has been a 284 percent increase in overall dental costs and a

Doars (millions)944 $2,728 $4,473 $7,500 284

expenditures or most other health costs have. For example, physicians'
services costs have increased by 296 percent overall, and on a per
cpita basis by 234percent. l tal sts have ind by
448 percent, and per captahosital costs by 362 percent. Americans
spent roughly one third as much on dental services in 1975 as we did
for physician services; $22.1 billion for physician services and $7.5

Mueller and Gibson, in an article appearing in the June 1975
SS d onthe cost of healthservices for the
fows the ost of health services for the
aged for the period from 1972 through 1974.
(in millions) Per capita
1972 ----------------------------------------------- $375 $17.90
1973 ------ 402 18.85
1974 .----429 19.58

Dental costs for the aged increased by roughly 14 percent, approxi-
mately the same as physician services, whereas overall costs of health
care for the aged increased by roughly 23 percent.
As a percentage of total health care costs and expressed in absolute
terms, the aged spend considerably less for dental care than does the
remainder of the population. In 1975, the total population spent,
or had spent on their behalf, nine percent of total national health
expenditures on dental services. The aged spent, or had spent on their
behalf 1.6 percent of total national health expenditures. This lower
expenditure is not the result of less need, however; it is the result
of the greater percentage of poverty among the elderly.

Dental services are optional under the requirements of the Medicaid
program. Thus, the 4,232,550 aged people who are Medicaid eligible
can receive dental care if they are lucky enough to live in a state which
has opted to provide dental services under the Medicaid program. In
December of 1974, 41 states offered some kind of dental care as part
of their Medicaid programs. However, over the past 2 years, a number
of state governments have cut back or eliminated many of their op-
tional Medicaid services in order to reduce expenditures.Theresult
of this is that by January 1976, only 36 states offered dental services
as part of their Medicaid program (11 of those states covered dental
services only to the categorically needy, while 25 states also provide
coverage to the medically needy). This situation may continue to
grow worse, leaving even more poor aged people without adequate
dental care, as three more states (Ohio, Connecticut, and Illinois) are
considering eliminating dental services from their Medicaid programs.
Medicare is even less helpful to the elderly in need of dentures but
without the money to pay for them. Under Medicare, dental care is
authorized only for surgery related to the jaw or any structure con-
tiguous to the jaw or to reduce a fracture of the jaw or any other facial
bone. Medicare provides no coverage for the routine dental services
that are so badly needed by the elderly. Just how limited Medicare's
coverage of dental services is can be seen from the fact that Medicare
reported spending no money for dental care during 1975, according to
the Mueller and Gibson study of health costs for the aged.
As for health insurance policies, the subcommittee has found that
such policies are generally similar to Medicare in that they provide no
coverage of routine dental services. In fact, dental costs are the least
insured major health cost in the United States. It is estimated that
roughly 10 percent of all Americans have dental insurance. Dental
insurance, however, is the fastest growing line of health insurance.
Between 1962 and 1974 dental insurance coverage increased by. over
3,300 percent. The following table shows the numbers and percentage
of the United States population covered by health insurance, including
dental insurance.



Physicians' services
X-ray Office scribed
and ao- and drugs Private- Visiting- Nu -
Hospital Surgical ;-hos- ra home Denta (out of duty nurse home
.I; End of year care svics tal s vs visits carehospital) nursing servic care

Number (in thousands)
1962.-----..----..... 120,80 120,528 65,671 (1 1,006 47,907 46,143 43,203 4,975
S1965 ---.. --- (1) (1) 79,500 Q 3,100 200 000 60,10 900
1966. ---- ) ) ( 000 0 4,227 65,544 722 7004 17,814
1967.--..--- 145,454 142, 480 4,679 71,201 76 080 81771 18754
1968( (9 128,14 97,703 5,821 79,280 83,485 9523 1046
196 ............. 133 914 12 1) 0 8 805 91 211 100,343 28 ,0
1970....... 154,6 150,001 145589 142,441 101,970 12210 100966 100,235 106,882 32,392
1971......... 3 () ( 148,514 145,207 () 15348 985 104,730 110,215 33636
1972............- 155,253 152,651 149,734 149,44 () 17904 111,374 108,959 115,904 45,400
197. ( (1) 153,461 152, 97 (1 21 626 124,971 11 805 122,88 69152
197----------163,3 159,518 15022 153,017 125,183 33297 141,755 141,167 136,687 69,840
SPercent of civilian population
1962 70.0 65.0 () 35.0 (9 0.5 26.0 25.0 23.0 3.0
1964------------- ( ( ( 41.2 () 1.6 27.6 29.0 31.2 5.1
1966 I ---- ( (9 4 8.0 () 2.2 33.7 35.0 40.6 9.2
1967----------- 73.9 72.2 -) 47.0 2.4 36.2 38.7 41.6 9.2
1968------. ---- () (1) 64.5 49.2 ( 2.9 39.9 42.0 45.5 9.6
196.. (1) () 66.6 62.2 ( 4.2 44.7 45.4 49.9 14.0
19......-------. 75.9 73.9 71.7 70.2 50.2 6.0 49.7 49.4 52.6 16.0
1971....-...------- ( 72.3 70.7 (1) 7.5 52.1 51.0 53.6 18.8
1972.... 74.9 73.8 72.2 72.1 () 8.6 53.7 52.6 55.9 21.9
1973.......... ( ( 73.4 73.1 (1) 10.4 59.8 56.9 58.7 33.1
1974......-------77.6 75.7 73.6 72.7 59.4 15.8 67.3 67.0 64.9 33.2

SData not available.

Payment for dental services through public programs has also
increased rapidly. The following table shows the growth in public and
private payments for dental services.

Percentage distribution by
source of funds
Total (in .
millions) Private Public

Fiscal year:
S1950 -...........................---.- .... ---. $940 100.0--------
S1955.. .......... 1,457 100.0 ----
S1960......-- -......... ---- ---......_ ---- 1,944 99.8 0.2
S195.................................... -.......... 2,728 98.8 1.2
1970.--_--- .._ ____ ....-.... .__ .. 4,473 95.3 4.7
1971-..................... 4,908 95.0 5.0
5 1972- .- 5,-__,- 5,342 94.8 5.2
1973 .. 5,767 94.6 5.4
1974.-.......... ........ ....... 6-- 200 95 5.5

S1975, the cost of dental services was less than one perent of total
public health program costs. The following table shows the increases in
dental costs for public programs for the period from 1973 to 1975.

E 3i;p


1973 1974 1975

Tota- -...............----- -----..---..---.---.......... .$321.4 $332. $414.
Title IX .................................................20.4 258.4 337.1
Veterans'Adinistration -----...........------.....----------.....................---------------. 55.2 44.9 51.4
Other-- ..-----..... ---------......---- ---.. 45.8 29.5 26.3
Federal ...--------....-----------.............------.--- 217.7 215.3 254.8
Title IX...----..--......----.... -----..----.----...------...- 119.6 144.7 18
Veterans' Administration ..---- ----------- 55.2 44.9 5.4
Other -.......-------.... ----..-----..--..-----..-------.. 42.9 25.7 22.7
State ................---.--------..----.--....---------- 103.8 117.5 160.1
Title IX.....--.---....................------ -C............ 100.9 113.7 156.5
Other -----.....--... --...---.-------------------.. 2.9 3.8 3.6

For 1974, the last year for which data for both private dental health
insurance and public programs is available, dental costs met by third
party coverage was roughly $1.2 billion.

O r on f of all persons 65 years of age and over suffer from
impaired heing according to the Federal Council on the Aging.and
the American Speech and Hearing Association. For 8 percent of the
elderly, the hearing impairment is so serious that they are unable to
Swords that are spoken in a normal voice. For millins of elderly
Americans, the solution to these problems is the use of a suitable hear-
ing aid. Yet, in attempting to purchase needed hearing aids, the elderly
must confront inadequate regulation of hearing aid sales, excessively
hih prices, and a virtual lack of coverage under Medicaid, Medicare,
and other health benefit programs.
aring impairment tkes a variety of forms. The first form it can
t is an inability to hear speech and other sounds loudly enough.
This is referred to as a loss in hearing sensitivity or simply a hearing
s. A second form of hearing impairment is an inability to hear
Sand other sounds early even though the sounds are sufficiently
loud. What is head may be similar to gabled speech from a radio th
a broken speaker. This is referred to s an impairment in speech

Man hearing impairments are suble in nature and difficult to
recognize. A mild hearing loss or a loss in hearing sensitivity for high
frequency sounds may not be noticeable except under adverse listening
conditions such as when the background is oisy r when the sound
source is some distance away. A high frequency hearing loss may make
it difficult for a person to differentiate between words that are the same
except for differences in high frequency consonant sounds like f, s, or
These s ds often unh r heard in a distorted way by
people with high frequency heing losses. Thus,wors like fit and sit,
or math and mass, are frequently confused.
Th et (71) National Health Survey on
hearing impairments indicae tht there are 13.2 million people over 3
years of age and living outside of institutions, who had a hearing
impairment of some kind in one or both ears. Of these, 6.2 million had
good hearing in one ear and could usually function as well as people
with normal hearing. About 60 percent of those with bilateral hearing
problems reported that while they had some difficulty hearing, they

could usually hear words spoken in a normal voice. However, the sur

more serious hearing impairments and were usually unable to hear
words spoken in a normal voice.
The likelihood of having a hearing impairment rises sharply with
increased age. The percentage of the population with hearing problems
in one or both ears is shown in the following table.
I-'1 7.

lI~Ir8 i~ .~ '\.ii "~
~ ~' ii-;s I l-i


Percent of Number
Age age group (thousands)

3 to 16 years--------............------ --- ---..-.....----....---........ 1.62 905
12 to 24 years-...........--....................... ........... 2.65 723
25 to 44 years---......------..... ------.....-------------------.......... 4.47 2,118
45 to 64 years-..--- ,--....... --. .....-..............- .. 10.00 4,178
All ages------..... ..-- ....---,....----..------------,-- ------------...... 6.90 13,228

Of the 5.3 million elderly people who had a hearing impairment, 3.3
million (17.3 percent of the aged) had a problem with both ears. The
most serious problem is that 1.5 million elderly Americas (7.9 percent
of the aged) were simply unable to hear words that were spoken in a normal
voice, as the following table indicates.

[Data are based on household interviews of the civilian, noninstitutionalized population]

Persons with bilateral hearing problems who Persons
All reported who
persons At best Can hear Can hear Persons to did not
who can hear words words with response respond
reported words shouted spoken in problems to self- to self-
hearing shouted across a normal in only rating rating
Sex and age problems Total in ear a room voice one ear scale scale

All ages 3 years and over..... 13, 228 6, 414 707 1, 740 3, 878 6, 225 336 253
3 to 16 years- ..--..- 905 394 37 114 240 423 61 2 27
17 to 24 years-------------- 723 214 2 13 49 148 462 2 33 2 15
25 to 44 years------ ------- 2,118 615 46 109 452 1,377 66 60
45 to 64 years_------- 4, 178 1,845 135 421 1,262 2,166 88 79
65 years and over-...... 5, 304 3 347 475 1,048 1,777 1,798 88 72

1 Includes 89,000 persons who did not respond to Gallaudet Scale.
2 Indicates estimate has a relative standard error of more than 30 percent. In general, the relative standard error will be
less than 30 percent when the population estimate is greater than 35,000.
Source: National Center for Health Statistics: Persons with Impaired Hearing, United States, 1971. National Survey,
Series 10, No. 101.

According to the National Health Survey, slightly over a million
aged people with hearing impairments were using hearing aids.For
example, many elderly people with sensorineural hearing losses (a
type of hearing impairment related to the nerves) were helped by the
sound amplification of a hearing aid. According to Dr. Blue Carstenson
of Carstenson and Associates, in many cases, the use of hearing aids
ends the "isolation, degradation, and loneliness" of many older
people who might otherwise be mistakenly "thought to be practically
On the other hand in some cases such as profound hearing loss, a
person cannot hear speech clearly even with the use of a hearing aid
and may receive only limited benefit or no benefit from the use of one.
In these cases, medical treatment, such as surgery, is necessary to
correct the hearing loss.


Because of a great deal of public alarm, the delivery system and
pricing of hearing aids has been the subject of numerous investigations.
In October 1973, the Retired Professional Action Group (RPAG), a


nonprofit consumer advocacy group, undertook detailed study of the
hearin d dvery system and published its findings in a report
entitled "Paying Through the Ear: A Report on Hearing Health Care
s." At approximately the same time this report appeared, the
Subco mttee on Consumer Interests of the Elderly of the Senate
Special Committee on Aging held hearings on "Hearing Aids and
der Americans." In May 174, an Intrade tmenta Task Force
was established within HEW to examine the issues described in the
RPAG report and the Senate Hearings. The Task Force report,
entitled"Final Report to the Secretary on Hearing Aid Health Care,"
was published in July of 1975. In October 1975, a report was published
by thestaff of the Permanent Subcommittee on Investigations of the
Senate Committee on Government Operations. The conclusion these
studies and of the investigation of e esa the Subcommittee on Health and
Long-erm Care is that theree are several serious abuses hich demand
correction in the way that hearing aids are sold.
One of the most crucial issues that has been brought out of these
investgatons is that, as it is presently constructed, the hearing aid
deli system in the United States fosters a clear and continuing
conlict of interest that pits the financial interests of the seller against
the h th and economic interests of the buyer. That is, at the present
time, the profit orientation of the hearing aid dealer may cause him
to sell a hearing aid to a person who has not been examined by a
doctor and who mighnt need the expensive device For example a
survey of hearing aid dealers in the District of Columbia that was
made by the National Council of Senior Citizens showed that 27
percent of the dealers recommended the purchase of unnecessary
hearing aids.
The subcommittee strongly favors, as a solution to the problem of
the sale of unnecessary aids, a requirement that a person purchasing a
hea g aid must first acquire a medical clearance from a physician,
preferably a hearing specialist.
On April 21, 1976, the Food and Drug Administration proposed
regulations, that would, in general, prohibit the sale of a hearing aid
to a patient before he has been examined by a physician. Patients
who are age 18 or older would be permitted to waive the medical
examination if the seller determines that none of the following otolog-
ical symptoms of a medical malfunction are evident at the time of the
1. Visible congenital or traumatic deformity of the ear.
2. History of active drainage from the ear within the previous
90 days.
3. History of sudden or rapidly progressive hearing loss within
the previous 90 days.
4. Acute or chronic dizziness.
5. Unilatera hearing loss of sudden or recent onset within the
previous 90 days.
6. Audiometric air-bone gap equal to or greater than 15 dB
(ANSI) at 500 Hz1, 1000 Hz, and 2000 Hz.
7. Visible evidence of cerumen accumulation or a foreign body
A 60-day period was provided for comments on the proposed regula-
tion. At the prsent time, the Food and Drug Administration is


The sibcommittee believes as does the American Speech and Hear-
ing Association (ASA) and others that the waiver loophole in the
proposal represents a "double standard" in requiring an examination
by a physician for hearing aid purchasers who are under 18, while
permitting older people to waive the examination in most cases. Those
who support the waiver argue that it is unnecessary because of such
factors as the inconvenience of securing medical assistance in rural
locations andreligious beliefs which preclude consultation wit a
The subcommittee rejects this approach of using a waiver. It favors
an alternative approach of granting exemption to those people who
deserve them and requiring everyone els, regardless of age to receive
a medical examination before purchasing the hearing aid (see pp. 40-
The various investigations of the hearing aid industry have brought
out other serious issues in addition to the need for a medical clearance
requirement. One such issue is the need for adequate training of
hearing aid dealers. Top quality instruction is essential because a
dealer can only be competent if he or she has received such training.
At the present time, the National Hearing Aid Society (NHAS) is the
only organization offering a national instruction program for dealers.
Most of the licensed hearing aid salesmen in the United States have
taken this course of instruction which consists of 20 home study
lessons. Yet, a 1975 review of this course by representatives of the
Veterans Administration (which has provided hearing aids to veterans
for 30 years), the American Council of Otolaryngology, and the
American Speech and Hearing Association has severely criticized the
NHAS home study course. The representatives of the Veterans
Administration concluded that the course was "not only inadequate but
potentially dangerous". The VA continued, saying that,
It is dangerous in the same way that "quack" medicine is dangerous ** It
postpones or prevents adequate evaluation, diagnosis, and treatment of hearing
loss and its accompanying pathology. Some of those pathological entities are
life-threatening and require immediate and aggressive medical or surgical treat-
Similarly, the representatives of the American Council of Otolaryn-
gology concluded that,
* the Basic Home Study Course of the National Hearing Aid Society * is
"far too technical and beyond the scope of the simple salesman to comprehend in
any effective manner. Most of the material has been written for professionals with
college and post-graduate education.
Finally, the American Speech and Hearing Association, the national
audiologists' group, concluded that,
* a hearing aid dealer would not be competent, as a result of completing this
course, to accurately evaluate hearing. Because of its extremely superficial nature
and because it approaches the subject in a purely descriptive rather than interpre-
tative manner, the hearing aid dealer who completes the course would still be
ill-prepared to make the kinds of objective professional judgments and recom-
mendations necessary for the satisfactory and ethical rehabilitation of patients
with hearing impairments.
One solution that is under consideration to the severe inadequacy of
the education received by most hearing aid dealers would be strong
state licensure requirements to insure that hearing aid dealers meet
a set of minimum qualifications.
Eleven states now have no such laws at all. Inthe other 39states,
the laws that have been enacted a re frequently of only limited effective-


ness.The best example of this is the fact that nearly 50 percent of the
licensed hearing aid dealers in the United States have never taken
any kid of licsing exam. Instead, t have been "grandfathered"
into licenses because they had been deales prior to the enactment of
these laws. Even more serious, is the conclusion of the staff of the
n ubcommitte on overment Operatins that, "or the
S, trol of the ing bards rests in eands of the
dealers. In effe't they regulate themselves."
In view of the virtual lack of oversight and scrtiny of the hearing
idin try, it is no surprise t that th Federal Trade Com-
SFood and Drug Adinistration, and numerus Congress-
men and Senators have reported rceivig h dds of complaints of
abuses in th industry. Thre hve been numerous charges of false
adve g and misleading promtional practices associated with the
sale of hearing aids. In addition, there are numerous reports of high
pressure door-to-door sales, misrepresentation of the expected benefits
aid, and misl ing atements about "techno-
logical innovations" As the report by te Pemanent Subcommittee
ona Iveigations stated,
who were omplained against appeared t lak a strong of
i or a eree o ompetence sufficient to evaluate the cause of hearing loss,
to provide the rhearing aid if one was indicated, or to refer the client to a
doctor specializing in diseases M the ear.
e F r Trade Commssion is stri g to wipe out these abuses
tt misrepresentaon that is so commonplace in the
ery system. or example, the TC has conducted a
broad vestigation which has culminated in complaints against six
major hearing aid manufacturers. The complaints alleged that the
manufacturers had engaged in false advertising, supplied false ad-
vertising materials to their dealers and retailers, and had participated
in other unfair and deceptive acts and practices. All six manufacturers
we charged with falsely representing in their advertising that they
merchandise a hearing aid which is a new invention or involves new
mod features or new engineering or scientific concepts; that their
heaing aids will be beneficial to ersons with a hearing loss, regardless
of the type or extent of loss; and that their hearing aids will enable
persons th a hearing loss to distingish or undrstand speech sounds
n noisy or group situations. The manufacturers were also charged
with advertising claims when there was no reasonable basis for doing
so and failing to disclose the fact that many persons will not receive
any significant benefit from the use of a hearing aid.
In addition t these misrepresentation charges, the Federal Trade
Comission also filed other complaints ainst five of the largest).
hearing aid manufacturers, alleging that they had maintained a system
of exclusive territories, restrained trade, fixed prices, and intimidated
and coerced dealers to handle only their own brand of hearing aids
and to exclude competing brands. According to the FTC, because of
these practices, in some areas a particular dealer frequently had a
Virtual monopoly in the sale of hearing aids and intraband competition
was eliminated. The result of this was an increase in retail prices. While
complaints against two firms are still pending, three of the manufac-
turers have agreed to consent order.
Because of all of these abuses, the Federal Trade Commission has
recently proposed a Trade Regulation Rule for the hearing aid in-
:lly M~tlT^il~i*o" anisrl'i0*Vt JF!'# i t'"~-ht fU*So'/l lao c hra~si

dustry. The proposed rule, which is simila to the recommedation
of the HEW Intradepa ental Ta orce, would req
with the following provisions:
1. A buyer has the right to cancel the purchase of a heaing aid
within 30 days after delvery and pay only certain limited cancel-
delivered, and a 30-day supply of ba~ tterie
2. A seller has the right to antbuyer more e rights
than those mentioned in the Trade Reulation Rule
3. Manufacturers are requred to disclose the following material
fact in any advertisement which makes a performanc claim for
a hearing aid: Many persons with hearing loss will not receive
any cant benefit from any hearing aid.
4. Certainrepresentations concerning hearing aids, ch as in-
accurate claims by dealers that a retail outlet is actuly a
governmental, public service, or nonprofit medical, educational, or
research establishment, are prohibited.
5. Certain selli techniques, such as visits to potential buyers
for the purpose of inducing a sale without the prior consent of
potential buyers, are prohibited.
Additional reform proposals have been made by the Food and Drug
Administration. Besides the previously entioned medical-aranc
requirement, the FDA has poposed a hearing aid regulation which
would require that certain instructions, warnigs, and other infrma-
tion be provided to the hearing aid purchaser. The proposed regulation
would require labeling and include the statement that a hearig ai
will neither restore normal hearing nor prevent or improve organic
conditions result ing hearing impairment.
It is intersting to note that the National Hearing Aid Society,
representing hearing aid dealers, has denied the abuses that have been
documented by the FDA and FTC. In a letter to the subcommittee,
the NHAS has taken the position that despite the alegations to the
contrary and the FDA and FTC view that new regulations are needed,
the present delivery system is working satisfactorily. The NHAS has
argued that, "Most charges and accusations about the present hearing
aid delivery system have not been documented by reliable researh."
Furthermore, the NHAS claims that its own national survey directly
contradicts the criticism. For example, the 1974 survey shows tat
only 33 (18 percent) of the 184 hearing aid users studied reported
having trouble and only four of these were difficulties which the hearing
aid dealer was unable to solve.
Given the widespread abuses that have been documented in the
hearing aid industry, it is understandable that the Subcommittee
has found that hearing aid costs are excessively high nd a formidable
barrier to the millions of elderly who desperately need hearing assist-
ance. The rteail price of most hearing aids ranged frm $300 to $450
in 1972. The subcommittee believes that these high costs represent
additional evidence of overpricing because these retail prices are over
two and a half times the wholesale price. Further documentation that
these prices are higher than need be, comes from the fact that the Vet-
erans Administration, through its distibution system, has been able
to provide hearing aids to those eligible for only $205 each (see
Chapter V, delineating "Contract Purchasing"). The National Hearing
Aid Society has defended this high mark-up and claims that it is due



iout aid use, and
maintenance in addition to the actual hearing aid.
The subcommittee beves that an open hearing aid industry is
vital prerequisite fo lower costs to e y c umers. The subcom-
ttee is very concerned about the fact that, while there are about
50 manufacturers who sell hearing aids domestically, most of them
ha near the maet ontrol of the four largest manufac-
ur accounted for 50 percent of the dollar value of shipments
in 1970, or of the eight largest manufacturers, who accounted for
approimately 70 percent of shipments.

The subcommittee has found that existing public and private health
serviesto naion elderly. Medi for e, does not pay
for either hearing aids or hearing aid ex ations. Similarly, the
Medicaid program provides no coverage of hearing aids for the
elderly in 39 states. Finally, present health insurance policies rarely
provide any coverage of hearing aid costs. In short, the elderly, with
the excepton of those who are Medicaid eligible ad lucky enough
to live in one of the 11 states that does provide coverage, are forced
to pay the excessively high costs of desperately needed hearing aids
out of their own pockets.

Hearing aids, dentures, and eyeglasses are not oly cases'of medical
appliances that cost too much for the m of elderly people
who need them. There are numerous other medical appliances of
which this fact is true.
One of the most expensive prosthetic devices (taking the place of a
Urt of the body) is the pemaker. According to Dr. Sidney Wolfe,
irector of the Public tizen's Health Research Group, the actual
production cost of a pacemaker is no more than "several hundred
dollars." Yet, the current purchase price of the most commonly used
pacemaker is a significantly higher amount, $1,300.00, according to

the Health Research Group. Since Medicare does provide coverageod

The reason for hi*is high markup is that:

inelastic, providing little, if any, incentive for manufacturers to cut prices.'
I From the Research Dept. of Smith, Barney, and Company, New York.

In other words, rater tan investigtc the i
of pacemakers, the Department of Health, Education and Welfare,
which is responsible for adinistering the Meicare program has
continued to ignore the high cost of
million of the taxpayr's llrs over a a
priced devices. This is a violation of the Soial S it A
1814b and 1861v) which authorize Medicare to pay only "reasonable
costs" or "customary chargs or he devc
condemns this fraud and is particularly shockle tfie e
explanation for the high priceof pacemakers has been openly used
by Smith, Barney and Company, a Wal Stret firm, rer
encourage investment in Medtronics, a pacemaker manufacturer
which accounts for about 60 percent of U.S. pacemakcr sales. Because
of this nofl-compettive pricig, Medtonis ad profit increases
of 30 to 50 percent during each of the last 5 years, according to the
Health Research Group.
In addition to pacemakers, the subcommittee hasI ound numerous
other examples of medical applinces, such as ospital bds cruhes,
wheelchairs, and dialysis equipment which are covered by Medicare
and for which Medicare is paying excessively high amounts. This
situation continues despite the fact that the 1972 Medicare amend-
ments, Public Law 92-603, contained provisions to end these ecesse
payments. The Department of Health, Education and Welfare has
not yet implemented those provisions. .
Durable medical equipment (e.g. hospital beds, crutches, wheel-
chairs, and dialysis equipment) which is furnished to a Medicare
patient for use in his or her home is covered under Part B of the
Medicare program. If the equipment meets the program's definition
of "durable medical equipment", is appropriate to the patient's
condition, and meets the standard Part B deductible and coinsurance
requirements, Medicare will pay 80 percent of the cost of renting or
purchasing the device. The choice of whether to rent or purchase the
equipment is up to the individual who is receiving the coverage. When
the equipment is rented, payment is made monthly on the basis of
reasonable rental charges. When the device has been purchased b
the elderly person, Medicare will make payment either in a lump
sum for an inexpensive appliance or in monthly installments for a costly
Since Medicare pays the cost of durable medical equipment whether
it has been rented or purchased by the beneficiary, it frequentl pays
for the least economical way to provide te equipment to the ederly.
The result is an estimated loss to the government of $9.5 miin each
year. Examples of this waste of taxpayer dollars have been reported
by the New York Times. It cited the c of a wheelair that
cost $168 to purchase, being rented for a toal cost of $1,080, and a
respirator that would have cost $396 to purchase g rnted for
$1,932. Additional documentation of this abuse has come. from a
1972 General Accounting Office report to the Congress entitld
for Legislation to Authorize More Economical Ways of Providing
Durable Medical Equipment Under Medicare." The report demon-

strated that Medicare patients often reted durable medical equipment

claims of the 13,000 patients whose claims for durable medical
equipment wee processed in 1970. For the 13,000 patients, GAO
estimated that savings of $234,000includinghe patients share of
47,000-could have been realized i the equipment had been pur-
chased when the anticipated periods of need indicated that purchases
would have been more economical than rentals.
At a sixth insurance carrier in a fifthstate,- GAO analyzed a sample
selected from the clais of the 7,000 patients whose claims were
processed during August 1971. For the 7,000 patients, GAO estimated
that savings of $763,000-including the patient's share of $153,000-
could have been realized.
Sthe recommendations made by GAO in its report,
legislation (Public Law 92-603) was enacted in 1972 which was

r the legislation,. theSeretary of Health, Education and Welfare
was authorized to experiment with reimbursement approaches (in
various geographic areas) which are intended to prevent those un-

b. f fe is p
reasonable expenses. HEW is also authorized to implement, without
further legis on, any purchase approach that is found to be workable,
desirable, and economical.
Congress has, suggested that among the possible approaches to be
evaluated would be the feasibility of suppliers contracting with the
Secretary under arr ngements whereby rental would be undertaken
by means of lease-purchase arrangements providing for rental pay-
s t rminate when a greed upon al for purchase was
reached under another approach, Medicare payment for a covered
item of durable medical equipment would be made to the supplier
in a lump sum where itwas determined, in accordance with guidelines
of the Secretary, that outright purchase would probably be. more
ecnoical than lease-purchase; another iapoach would be to
encourage beneficiaries to purchase used equipment by waiving the
20 percent coinsurance requirement where the purchase price of the
used equipment is at least 25 percent less than the reasonable price
of the item if purchased new.
The subcommittee is extremely disappointed to find that now, some
four years after this legislation was enacted to end this waste of 9Y
mI'lion taxpayer dollars each year as well as the waste of the limited
money of the elderly, this abuse continues to rage because the Depart-
ment of Health, Education and Welfare has still not implemented the
provisions of this legislation and instituted more economical purchase
approaches. While HEW has claimed that this delay was needed to
design an experiment, the subcommittee can see no reason why HEW
has delayed for 4 years in imp lementing the legislation. HEW is cur-
rently coducting a "desigon of an experimental concept."
The lack of reason for a four-year delay is pointed out by the fact
that the National Association of BlueShield Plans, which represents
Medicare beneficiaries, has iformed the subcommittee .that 'several


of our plans are actively and eagerly seeking to participate in the
durable medical equipment reimbursement demonstration authorized
under Public Law 92-603."
SAnother medical appliance which lmany eldey people purchase is
the home blood pressure monitoring device. These devices have gone
from a novelty mail-order item to a heavily purchased appliance
available in drugstores The reason for this growth in the use of home
blood pressure monitoring units is the increased activity by govern-
ment and health associations in publicizing the great danger of high
blood presure. This resulted in an increased public awareness and a
greater demand for devices that a hypertensive person could use to
measure their own blood pressure in the own homes. As public
demand for the devices has increased, there has also been greater
acceptance by doctors of the value of hypertensives using the devices,
although many doctors continue to warn against patient use of the
The blood pressure devices that are available in the United States
fall into two categories: mercurial devices and aneroid devices. Each
type has both advantages and disadvantages.
Manufacturers of mercurial devices (blood pressure monitoring units
which make use of mercury to measure hypertension), such as Mr.
John Baum, President of W. A. Baum Co., Inc., claim that these
devices are the only accurate way to measure blood pressure. They
argue that accuracy is the most important characteristic on which the
device should be judged. As Mr. Baum said at a subcomittee hearing,
"If an instrument is not accurate, and capable of remaning accurate
it would not be a bargain even as a gift. Truly i is better not to have
any blood pressure data at all than to have erroneous data."
On the other hand, distributers of imported aneroid devices (blood
pressure devices which make use of gravity to measure hypertension)
such as Mr. Alan Beeber, President of the Lumiscope Company, argue
that aneroid devices, while not as accurate as mercurial devices, are
certainly accurate enough for home use, since they do meet a federal
accuracy standard of .3 millimeter. They claim that any difference in
accuracy is not significant enough to justify the higher cost of mer-
curial devices. Because that price difference is so great (mercurial
devices cost about $50 to $60 while aneroids cost about $25), aneroid
distributors argue that practical consumers would be wise to purchase
the less perfect but sufficiently reliable aneroid.
In short, the subcommittee has found that the elderly consumer
who needs a blood pressure device has a choice between the mercurial
and aneroid types with their possible differences in accuracy and price.
Regardless of which type the elderly consumer does choose, he or
she must pay for the device out of his or her own pocket. Medicare,
Medicaid, and private health insurance policies provide no coverage
of home blood pressure monitoring units.
Another omission of coverage under Medicare which needs correc-
tion concerns a provision of title XVIII which because of an error in


drafting or other oversight, has led to denial of coverage of certain
durable medical equipment to residents of skilled nursing homes and
intermediate cae facilities.
Section 1861(s) of title XVIII defines "medical and otherheealdth
services" as thi ter isse in he Sop of e nefits under Part 1B.
Medic d other health servis includes durable medical equip-
ment" defined in Section 1861(s) (6) as follows:
(6) durable medical equipment, including iron lungs, oxygen tents, hospital
dsand wheelchairs used in the patient's home (including an instittion used as
s home oer th n n institution tha meets e reqirents of subsection
(e) (1) or (j) (1) of this section), whether frnished on a rental basis or purchased.
The pparent purpose of the parenthetical language is to make these
benefits available to persons making their homes in institutional
settings as well as to persons residing in individual homes, but to ex-,
clue them from coverage under Part B wen they can be covered
under Part A. ubsection (e)(1) refers to hospitals and subsection
1) s t skilled nursing facilities which provide post hospital
extended care services under Part A.
The problem is created by the fact that the exclusion is written in.
terms of the characteristics of the institution i which a person may
make his home rather than in terms of the person's entitlement to rye-
ceive the services through the institutional care covered by Part A.
Many persons make their homes in institutions which meet subsec-
tion () (1) but who are not currently eligible for institutional benefits
under Part A. These include, for example
Patients in skilled nursing facilities who require skilled care but
not in connection with a prior hospitalization
Residnts of intermediate care facilities. (Most ICFs "meet the
requirements of subsection (j) (1)".)
he ost serious manifestation of this problem is in denial of cover-
e for oxyg M aid generally is not a resource. Afew states, but
i y f vide some oxygen under the heading of rescribed drugs,
n generalhowever, the situation is that a person nedin oxygen, who
would be entitled to it under Part B if he resided in an individual home,
has no access to coverage of oxygen beause he makes his home in an
institution; a situation contrary to the apparent intent of the original
The problem cai be corrected by modifying the parenthetical lan-
guage Section 1861(s) (6) to clarify that the exception intended re-
lates to persons entitled to the same benefiits as a part of institutlional
care for which payments are being made under Part A.
The Social Security Administration/Bureau of Health Insurance has
estimated the cost of closing this gap in protection to be between $1
million and $2 million per annum.

In investigating the unmet need for medical appliances of the
elderly, the subcommittee has found several exceptions to the virtual
lack of meaningful assistance by the health benefit programs intended
to meet such needs. These represent outstanding examples of action
by government agencies to provide low-cost hearing aids, eyeglasses
and dentures to thousands of people who require those devices. Most
of these programs, such as those of the Veterans Administration,
Defense Department, and General Services Administration, make use
of volume contract purchasing to lower the cost of these appliances.
These programs have been able to supply medical appliances for
40 to 500 percent below the cost of identical devices purchased from
retail outlets. A thorough examination of these existing programs has
demonstrated to the subcommittee that similar contract purchasing
for our nation's elderly would mean an end to the high cost of their
devices, would end many of the abuses that reduce quality and raise
costs in these industries, and would help to answer the vast need of
the elderly for medical appliances.
One of the most extensive volume contract purchasing programs is
operated by the Veterans Administration. In 1975, for example, the
VA supplied approximately 13,700 hearing aids and 21,000 eyeglasses.
Because the VA purchases in large volume from the manufacturer
that has made the lowest bid, these medical appliances were supplied
at costs far lower than the general retail costs. The VA makes these
appliances available to veterans in their hospital system or nursing
homes and to service-connected veterans who need hearing aids.
In the Veterans Administration's program, eligible veterans who
have hearing difficulties are first examined at one of the 171 VA
hospitals by an ear specialist to determine whether medical or surgical
treatment is appropriate. If a hearing aid seems appropriate, the
veteran is usually referred to one of the 45 (in 1975) VA contract
clinics for an audiological evaluation by an audiologist. When the
VA determines that t is not feasible for a veteran to travel to one of
the audiology clinics, he can be authorized to purchase an aid from a
local dealer. In such a case, the examining physician must test the aid
to be purchased on the veteran to assure that it is satisfactory.
The VA has developed a program for evaluating the more than 500
models that are available in the United States so that only those of the
highest quality are selected for distribution. Each year the Veterans
Administration invites manufacturers to submit their models for
possible use by the VA. For example, in 1974, 19 hearing aid manu-
facturers responded to that invitation and submitted a total of 114
models for review. These models were submitted to the National
Bureau of Standards which evaluated their performance charac-
teristics. The Bureau of Standards then recommended specific models
to the VA after consideration of their performance and cost.


The VA procures its hearing aids under two arrangements: hearing
aids are purchased directly from the manufacturer for distribution to
A fa; ad where this is not posibe they are purchased from
local de alers. Of the 13,700 hearing aids the VA purchased in 1975,
about 95 percent were purchased directly from the 14 manufacturers
participating in the program.
subcommittee has found that the VA program has received
inmerus consumer groups, such as the Public Citizen's Health
h up the Retired Professional Action Group and the
Consumers Union. Perhaps most worthy of commendation is the fact
that the VA pr am has consistently provided the hearing aids for
extremelow prices. Forexampe,for the current year the cost of the
medical examination, hearing aid evaluation overhead, depreciation
of equipment, utilities, assembly of the hearing aid, and the hearing
ai itse as estimated to be about $205 by the Veterans Administra-
heNaioal Hearing Aid Society representing hearing aid
ealer, has chenged these figures and claimed that the actual cost
Shea g aid ranges from $347.17 to $1211, it is important to
note that the enormous cost s s under the VA program have
beeproven by the General Accounting Office.
GAO, an independen arm of the Congress, determined that it cost
the VA average of $199.90 or $5 less than the figue estimated by
the VA, to issue a hearing aid. This incuides all the costs involved.
The subcommittee believes that the GAO figure completely refutes the
Natioal Hearing Aid Society claim and considers the price quite
remarkable when compared to the average $50~ cost to an individual
purchasn a hearing aid privately from a dealer. In other words,
the VA through contract purchasing, has been ale to supply almost 14,000
aring aid t year alone for more than 40 percent less than the general
rettail cost.
The Veterans Administration also supplies eyeglasses to eligible
veterans and purchases them direct from the manufacturer. They are
y c rating ith B sch d Lo for this purpose. Under
te Vterans Admiistation contract i Buausch d and Lomb, the
prescriptio is filled and the glasses assembled by the contractor
at the time the presription or prescriptions are submitted to them.
Like the VA hearing aid program, the result of this contract
has been that glasses are spplied at a cost far below the ost an
iii l prchasing glasses fm a dealer would have to pay. The
Sglasses pro by heA is $1 for single vision .
glasses with frames and caseand $15 for bifocal glasses with frames
and case. The identical glasses sold on the open market cost around 50 or
more than 350 percent more than the price the VA pays.
In addition to the Veterans Administration, there are other examples
of this type of volume contract purchasing of medical appliances by

that has submitted the lowest bid. The Department of Defense dis
tributes the lenses, frames, and cases that it purchases to regional
storage centers, which, in turn, distribute them to installations. The
Department also operates regional laboratories which fill prescriptions
I,' n *tem.-o Th


orders, or the most part, lenses of v ous pwers and fills ppt
from stock. Lenses are not grod by the
contractors at the time that the prescription is presented. The foowing
prices were quoted to the subco ie
Defense Department Supply Agency in P ihdphia:
Single vision pair. ........... $1.001.05
Single vision lenses, plastic, ----------- ................
Plastic frames ------- -----------------................. $1.00-1.05
The price range noted for the lenses indicates w the great
majority of prices for lenses cluster. Some prices do fall outside
range, both below and above. For example, some glass lenses may cost
as little as 85 and some may cost as much as $9. T costs consti-
tute only a part of the total cost of eyeglasses since the
be shipped to regional storage centers and dispesed ugh
regional laboratories.
The Defense Supply Agency has informed the subcommittee t
the final cost of eyeglasses dispensed through th ilitry yste
ranges from $7 to $8. This price is very silar to the price of glasss
in the Veterans Administration program and again, much lower than
the cost of eyeglasses purchased retail.
Another example of volume contract purchasing resulting i loer
costs for a medical appliance is the General Services Administrtion's
system of providing dental supplies to federal agencies. The General
Services Administration negotiates with suppliers nationally, region-
ally, or locally to provide supplies on demand at negotiated prices.
This enables such agencies as the Indian Health Servic anr the
Uniformed Services to obtain dental supplies at considerably below
the general cost to consumers.
The cost of false teeth represents the most extreme example of such
cost differences. Laboratories which make dentures commonly pur-
chase teeth in sections, putting the sections together to form plates.
The sections will contain six each for the front teeth and eight or the
rear teeth. Under the General Services Supply Schedule, federal agen-
cies are given a 77.93 percent discount (therefore actuay y
approximately 22 percent of the usual cost) on the purchase of por-
celain "one by sixes," i.e., front teeth in sections of six. The suggested
retail price of "one by sixes" purchased normally is $12.86. In sharp
contrast, the federal agency price with this discount is $2.84. This
represents a drop of approximately 500 percent. According to the
Indian Health Service dental laboratory in Albuquerque, which has
a contract purchasing arrangement with the General Services Admin-
istration, the cost of teeth is the single largest cost saving when
comparing the cost of dentures made by the Indian Health Service
and those made by commercial laboratories. Overall, the difference
between the 1975 fiscal year costs of dental work performed by the
Indian Health Service laboratory in Albuquerque and commercial
laboratories in the same area was between 20 and 5 ercent.


ra Services Administration has a similar program for the
puchase of eyeglasses. The Indian Health Service, one of the agencies
receiving gl s from the General Services Administration, has told
the subcomtee that the estimated cost of eyeglasses under this
program is approximately $18.


f the low osts tha result from volume con-
tract arrangements is the group purchasing plan operated for em-

mpared to average ret pricesofabout $35.

purchasing in lowering the cost of medical appliances has been proven
numerus times. Existing examples have provided needed appliances
for prices vastly lowet than the cost when purchased by a lone indi-
the aler. erhas the ultimae proof of the value of
these programs is that numerous consumer groups have enviously
viewed the low costs that result from volume purchasing arrangements
e orme coeratives. For examplehigan two such
cooperatives have been formed of people, including many senior citi-
zens, who have banded together to purchase the medical appliances
that they ne. Theresult has been significant reduction in the cost

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The Subco ttee on Heat and ng-Term Care a stigated
the needs of the lderly for eyeglasses, detures, and heaing aids and
the costs of these medical appliances That investigation has demon-
strated to the subcommittee that, in the re of medical appliances,
the elderly are simply not receiving te high-quality health care
that they are entitled to and that they so desperately need. For
example, five million elderly Americans are wearing glasses which
need correction. 3.4 million Americans over 65 have dentures
need to be replaced or refitted. Finally, 1.5 million elderly Am
are unable to hear words that are spoken in a normal voice and need
either hearing aids or medical help.
In theory, public and private health befit progras were creted
to meet this type of svere health nee However, the aea of
appliances, these programs have been of only the most limited help.
As this report has shown, edicre does ot cover the cost of eye-
glasses, hearing aids, or dentures. Medicaid does cover these devices,
but only in some of the states Finaly, pvate health insur
policies rarely cover eyeglasses and hearing aids and cover dental
costs only occasionally. In short, elderly people who need medical
appliances must either pay for them out of thr own pockets or simply
do without them.
The way to answer the vast unmet need of the elderly for medical
appliances is for the federal government to become more active in
helping the elderly in this area. The Subcommittee considers this
increased federal assistance to the elderly vital; it is the only way to
insure that the elderly have these vital health aids.
This federal assistance to the elderly coud be provided in two ways:
either as part of a comprehensive national health insurance program or
separately, as an extension of Medicare.
The subcommittee believes that in the absence of national health
insurance, it is essential that legislation be passed which would extend
coverage under Part B of the Medicare program to provide pments
for: dentures (including the repair thereof and such dental services as
are necessary to rit such dentures, including the extraction of teeth),
eyeglases (and eye examinations for the purpose of prescribing fitting
or changing eyeglasses or for the purpose of determining the need
therefor), and ring aids (including hearing examinations for the
purpose of determining the need thereof).
An earlier subcommittee report, "New Perspectives in Health Care
for Older Americans," recommended this extension of Medicare
Part B. This report restates that recommendation and further docu-

ments its urgency. Legislation to authorize this extension, such as
H.R. 12676, sponsored by Rep. Claude Pepper, and H.R. 12481,
1. sp b o.
The subcommittee has found that the Medicare Part B extension
could be quickly implemented by making use of existing Medicare
administrative mechanisms. The additional coverage would represent
no extra buren to those mechanisms. For example, the N ional
Association of Blue Shield Plans, which presently acts as the carrier
for some twelve million Medicare beneficiaries, has informed the
subcommittee that their member plans "have the experience, the
Sto ter any new form of propely
medi appliance benefits for the aged."
With the extension, elderly people who choose to enroll in the volun-
tar Part B progra by pa g t premiums would be covered for
ss.One the spend more than $60 in a year on covered
Part B medical cae ex, edicare would' pay 80% of the
are determined to be medically necessary by a physician.
To finance the additional benefits, Part B monthly premiums and

Scoveringapproximately 30 percent of program costs), the effect

fi. fcot ibcreased '
of the proposal would be an increase of $2.66 per month in- the pre-

With thismall increase in monthly premiums, the subom ittee,
ce of the Deartent of Health, Education, anWel-
reha estimated that the cost to the federal government of pperating
the teded Pat B Medicare program for eyeglasses, hearing aids,
and dentures would be $1.9 billion per year. As is presently done with
the federal share of the existig Medicare Part B program, the federal
share of the costs of the program would be paid from general revenues.
Thuse the integrity of the socal security trust fund will not be afected.
These cost estimates are for the initidal year of coverage. According
to testimony presented to the Subcommittee at its June 23 hearing by
the Dpartment of Health, Education, and Welfare, during this first
ye the progra as well as the following 4 years, the cost of the
program paid by the elderly in premiums and by the federal govern-
ment would have to be maintained at these levels because of the
enormous backlog of elderly people who ae presently in desperate need
of medical appliances. Thus, it is important to note that the cost paid
by the elderly and by the federal government for this Medicare Part B
extension, would decline drastically by the program's sixth year. That
the program, depending upon the cost of inflation during this period.
$2.7 billion ($300 million for hearing aids, $600'millon for eyeglasses,

allowed for hearing aids, eyeglasses, and dentures and on the amounts


allowed for the related medical services. The Secretary should also be
directed to establish such standards for participation of suppliers, and
for the health items themee, ahe ems ny in de t
protect the health safe of the patt t sr
effectiveness and propriety of the services and items that would be
covered. In addition, the Secretary should be directed to establish, by
regulation, such limitations and presumptions as to quality and quan-
tity of dvices ashe ayde to be reas i rdr topr
payment for items and services which may be unnecessary or excessive.
This would include requirements for ertifcation of medical need by a
physician or other appropriate professional. It is important to note
that present law (Social Securty Act-Section 1832(a)(2)(b)) re-
quires such certification of medical need bya phyicia before Medi-
care payment can be made for those appliances which are already
covered by Medicare. Thus, there is a clear precedent for such a
requirement for eyeglasses, hearing aids, and dentures as well.
The omission of coverage for residents of skilled nfacil
and intermediate care facilities of certain durable meical equipment
under Medicare, Section 1861(s) of title XVIII shou be corrted.
Modification of the parenthetical language in Section 1861(s) (6)to
clarify that the exception itended relates to persons ntiled to th
same benefits as a part of institutional care for which payments are
being made under Part A. The cost of such coverage is etw $1
millon and $2 million per annum.
While the subcommittee considers it imperative that M ica
benefits be extended, it considers it equally imperative that the ex
tension not be done in such a way as to allow the inadequacies an
overpricing of the present delivery system of medical appliances to
continue. Indeed, it would be tragic if the Medicare extension would
mean additional profits and rewards for those who would prpetuate
the abuses of the present.
One way of insuring that a Medicare extension would not mean
continued high costs for medical appliances is to use ctract pur-
chasing of these devices. As a result of convincing testimony during
subcommittee hearings, the subcommittee recommends that volume
contract purchasing of eyeglasses, hearing aids, and dentures be
utilized by the Department of Health, Education, and Welfare to
provide these appliances to the people who pay the Part B premiu
Existing contract purchasing programs, operated by e eterans
Administration, the Department of Defense, the General Services
Administration, the state of Michigan, and others, are conclusive
proof that this would lower the cost of medical appliances from
excessively highlevels of the present.
The subcommittee recommends that legislation be p instruct
HEW to begin experimenting with volume contract purhasing as
soon as possible. In addition, the legislation should make it the official
HEW policy, to begradually phasedinwithi the next 5 to 10 years,
that volume purchasing beused wherever feasible, to provide eye-
glasses, hearing aids, and dentures to those covered by the Medicare


extension. Te subcommittee also recommends that states consider
making use of contract purchasing of medical appliances, as part of

Such a contract purchasing program might work in the following
way: manufacturers of medical appliances would be invited to bid by
submiti models of their appliances the lowest price at which the
could provide the devices through retail outlets to those eligible, and
information concerning the number of retail outlets that istribute
their devices. The Secretary of Health, Education d Welfa uld
Sbasis of those bids choose among the manufacturers and
contract with as many of them as necessary for large volume purchases
o t de t is rtant to note that it would not be necessary to
contract with only a limited number of companies in order to enjoy
the cost reduction that results from large volume purchasing. Here,
the existing purchasing program operated by the Veterans Admin-
istration serves a cear precedent: for example, in 1974, the VA
contracted with 14 different manufacturers for the purchase of a total
f 13,700 hearing aids. The result of these contracts was that the VA
was able to supply hearing aid for an average cost of about $200,
drastically lower than the average $350 retail hearing aid cost.
Te manufacturers that are awarded the contracts would be
r pr ding appliances, for the stipulated price, to
retail outlets. The retail outlets would then distribute the appliances
to elderly consumers who have paid the Part B premiums. Medicare
payments to the retailers would be based on:
The lower range of estimated quiition ost icurred by the individuals who
provide the newly covred items to the patient on an economical basis; plus
A fee for the disp er of the item which is sufficient to compensate the more

lderly consumers who ae covered by Part B and who did not want
to purchase their health aids from these manufacturers, could purchase
their hearing aids, yeglsses, and dentures from other companies. In
that case, they would receive reimbursement from Medicare for the
price that the identical device would cost when purchased through the
tct pr. They would not be reimbursed for the difference
Spchase price and the higher open market

hi i an to e cost of the ppliances,
ould still allow elderly consumers the freedom of chosee to determine
whether or not they want to participate in the program. Since this
system would alow consumers the choice of buying a device from a

consistent with Section1802 of the Social Security Act which guaran-
';. Jifutf'.l( | W tld .
tes patits the f cho of pviders of Medicare services.
By the same token, manufacturers who did not wish to participate
in the program or who were not selected for the program would still be
-ou4 reciveLt rite'b

be based on the lowes chare level at which they are widely and con-
sistently available from local suppliers. In addition, as of September,


1976, HEW is implementing such a measure concerning drugs pur-
chased through the Department's various health service and health
benefit programs. As part of this ffort, the government's reim
r t .| o .
bursement to pharmacies is being limited to the estimated acquisition
cost of the drug to the pharmacist plus a dispensing fee.
In its investigation of the hearing aid, eyeasses, and denture
industries, the Subcommittee has seen numerous examples of the
abuse of consumers purchasing these health aids. For example, as this
report has demonstrated, in the hearing aidindustry alone, there is
evidence of inadequate training of dealers, anti-competitive practices,
anti-trust violations, misrepresentation, and the sale of unnecessary
hearing aids to unwitting consumers by those dealers. The Subcom-
mittee thus believes, that extending Medicare coverage and the use of
contract purchasing represent only part of the solution. They alone
will not insure that these abuses will no longer be a part of these
The subcommittee recommends that a series of major safeguards
be enacted in this area to protect elderly consumers from the kinds
of abuses that they suffer today. Only through these positive actions
can we genuinely insure that the elderly will receive the highest
quality medical appliances and medical care.
The first of these safeguards is continued and increased scrutiny of
these industries by the federal agencies which hve the responsibility
of overseeing these industries and protecting the consumer. For ex-
ample, the subcommittee again requests, as the chairman did in the
subcommittee's June 23 hearing, that the Federal Trade Commission
investigate unreasonable charges in the hearing aid, eyeglass, denture
and pacemaker industries. A thorough investigation is vital in order
to stamp out the anti-competitive activities and anti-trust violations
that may be widespread in that dustry, as discussed earlier in this
report.. ... .
Another example of an area which requires increased oversight by a
federal agency is the home blood pressure device industry. The sub-
committee urges the Food and Drug Administration to determine the
accuracy of aneroid and mercurial devices and to issue minimum
standards of accuracy with which blood pressure devices must comply
in order to be available for purchase.
The second safeguard that the subcommittee advocates is action by
the individual states or a national Federal Trade Commission regu-
lation to end price advertising bans on these devices. Presently,
only four states (Texas, Florida, Virginia, and Massachusetts) allow
such price advertising. Analysis by the Federal Trade Commission's
Bureau of Consumer Protection has demonstrated that such bans
"reduce competition, restrict consumer access to information, and
allow higher than competitive prices to exist." The best example
of this is eyeglasses, where a lack of advertising has led to little
consumer knowledge of the incredible 200 to 300 percent variance
in the price of glasses.

i c f if i d edi -ic lass
retail. olets s particularly harmful to the elderly. There are two

reasons for this:irs of all, many elderly people have very limited

andoften fedincoar. They cannot afford to wamiste limited dollars
on overpriced medical appliances. The excessively high price may

actually prevet an elderly person from obtaing a desperately

t was od f years a
needed aid. Second of all, many elderly persons are severely
limited in the scope and range of their mobility and activities due the
chronic illness. As such, they are unable to engage in the kind of
Thus, they have a specal need for accessible price information through

Sc ct oadvertising. t
The third set of safeguards are needed to eliminate those M edicare
expenditures which are excessive and unnecessary. First of all, the
Department of Health, Education, and Welfare should immediately
implement leai or other economical methods of obtaining medical
equipment. Le ation authorizing this was passed four years ago
in this area. The subcommittee can see no reason for the delay and the

continued wase. Furthermore, the Subcommittee urges HEW to
closely scrutinie the osts that Medicare pays for health aids alreadyon
r sod i os ri ceiin
Act (see 1814b and 1861v). It should not subsidize the enormous
pr s ofpacemaker manufacturers, for example, and ignore obvious
overpricing, The Department must begin to conduct oversight of

"'s to these idustrie
are covered medical a ances include audits, at least on a random

asis, of medical ap ance manufacturers and providers. These
other types of fraud. To conduct these audits, HEWl, through its
sumer is found to have defrauded Medicare or the public in this

may add automatic service or overhead charges in connection with

a single medical appliance manufacturer in furnishing the equipment
to the patient. It is important to note that in implemeing the
safeguard, care ~iust be taken so that the new procedures wl not in
effect take away benefits from beneficiaries. The subcommittee thus
believes that the steps taken to protect freedom of choice must either
concern administrative expenses such as multiple relaed overhead
operations or a reasonable alternative approach of eliminating the
provider ageency as middleman.
Finally, HEW should mandate cross referencing of prevailing rates,
in order to create a profile of pricesin a partiar area, by all Part A
and Part B intermediaries. The intermediaries would tn kow te
maximum amount payable in an area and would ave a profile of what
each medical equipment supplier charges. This action would make
payments largely conform to "prudent buyer" guidelines. The Part A
intermediary would know the maximum amount paya to
supplier under Part B. The Part B intermediary would know what a
supplier is charging agencies for inclusion in the computation of e
supplier's profile.
The subcommittee believes that there is an especialy evere n
for a series of safeguards specifically directed at ending inadeqacies
of the present hearing ai delivery system. As represeatives of t
American Speech and Hearing Association stated in testi y sub-
mitted to the subcommittee:
A preoccupation with profit significantly diminishes the (hearing aid) industr's
potential to serve and generally benfit the health andwelfre inteests f
impaired Americans. Industry efforts toward rele, genuine self-re
have failed miserably. Attempts to achieve the kid of industry-profsiol
sensus which might have made thee regulations unnecessary have been
unsuccessful. Clearly, the time has come for the iposiion of reposibe industry
standards by the federal government.
One example of such a responsible standard that should be imposed
by the Federal Government is the proposed FTC regulation that
hearing ai purchasers must have the rigt to return hear aids. Another
example of a badly needed standard is the proposed regulation that
would require hearing aid manfacturers to labe their advertising with
the fololowing disclosure: "Many persons with a he g loss will not
rceive any significant benefit from any hearing aid." A third example is
the proposed regulation which would make it illegal to use certaii
techniques in selling hearing aids. For example, door to doo sale of
hearing aids without the consent of the prospective buer woiud be
barred. The subcommittee endorses these three proposals as vital in
order to reduce the large number of consumers who end up stckwth
hearing aids for which they have spent hard earned dollars and which
provide no improvement in hearing. Thus, the subcommittee recom-
mends that the Federal Trade Commission, which has proposed the
regulations, implement the proposals as soon as possible.
In addition, the subcommittee considers it essential that the Food
and Drug Administration promulgate a regulation wich would re
prior examination by a physiian, prefebly a h
purchase a hearing ai. The present lack of any such equirem is
the chief cause of the millions of dolars that are wasted for he
aids that can be of no help. The subcommittee rejects any solti to
this problem that does not include a medical clearance requirement


hich w ld be binding on everyone except where specific exemptions
are allowed. Thus, it condemns the proposal by the Food and Drug
Administration which would allow anyone over the age of 18 who does
not have certain symptoms simply to waive the required examination.
While the waiver's proponents argue that it is needed because people
in some rural areas have no access to medical care, the subcommittee
believes that this is not sufficient reason to allow everyone the right
to waive the requirement.he subcommittee favors a different ap-
proach to this medical clearance issue. It favors exemptions to the
requirement where they are needed (for example when an individual
lives in a rural area where there is no access to a doctor or when an
individual's religious beliefs forbid an examination by a physician)
but believes that all those not specifcally exempted on these grounds
should be required to see a doctor, preferably a hearing specialist, before
purchasing a hearing aid. Thus, the FDA's current proposal negates
the requirement for medically determined need on te grounds that
the requiremet may be inappropriate for a handful of Americans. A
much more logical approach would be to simply exempt such persons
forwhom medical clearance might not be appropriate, but to maintain
the requirement for everyone else. Thus the subcommittee considers
the FDA proposal inadequate.
Finally, the last of the series of safeguards needed in the hearing
care area is increased assistance by the Federal Government through
the Department of Health, Education, and Welfare, to encourage
continug education and traing programs for hearing spialists,
clinical audiologists, and physicians in order to improve the quality
of the hearing care they provide Similarly, tate and local public
health departments should be encouraged by the Federal Government
to provide greater hearing cae to the elderly, including a network of
examination and, tratment sites.
In its investigation of the delivery system of medical appliances, the
subcommittee has found numerous suggestions that consumers can
use to avoid overpriced delivery and unnecessary services. The sub-
committee recommends that people purchasing medical appliances
make use of these "consumer tips" in order that they will have eye-
glasses, hearing aids, and dentures that are of the highest possible
quality and the lowest possible price. In additi, where appropriate,
the federal g rnment and regional and local authorities should dis-
seminate such information to consumers. These suggestions are not
intended to serve as a complete listing, but are ones which the Sub-
committee felt might be useful to consumers. Some general sugges-
tions include:
1. If you are not eligible for participation in an existing contract
purchasing program (see Chapter V-Existing Contract Purchasing
Programs: Examples of Federal Assistance) you might wish to form
your own group of consumers with similar needs. Such groups can
save large amounts of money on. medical appliances by purchasing in
ilarge volume.


2. Be a comparative shopper sothat you can find the medical
appliance that you need for tht o i i i
In states where price advertising of these devices is legal, use these
publicly posted prices as peart f your comparative shopping and
encourage all retailers in these ar to adv their prices.

1. When having your eyes examined by an optometrist or optha-
mologist, make sure that the examination is thorough. It should
include questions concerning your complete case history and tests for
near, distant, depth, peripheral, color, and unaided vision. Eye
coordination should also be tested, Also, be sure that the
of the examination is professional and not that of a hurried selling j
Check to make sure you are not asked to examine eye charts under
conditions that might make those charts appear unclear suh as an
unfocused slide or a poorly lit room.
2. After the examination, d 't simply accept what is s
Insist on asking questions if you have them. For example, if you
already wear glasses and are told that you need a new prescr
ask about the amount of change between the old prescription ad the
new one. If the change is a small one (something under half a measure
called a diopter) you might wish to get a second opinion aut
need for new glasses.
3. Get the prescription from the opthamologist or optometrist who
has examined your eyes. Then begin comparative shopping to find the
optometrist or optician who can provide the nece gns at the
lowest price. Keep in mind the tremendous vaince in the cost of
identical eyeglasses. You might wish to consult friends or physicians
for their suggestions of where inexpensive glasses can best be
1. Before buying dentures you need to choose a dentist. "Shop
around" for the best one. Consult your family physician for his
recommendation of a good dentist. You might also wish to get recom-
mendations from the faculty of a local university's school of dentistry.
Finally, in some areas, public-interest groups have compiled directories
of dentists, listing facts about their backgrounds and practices which
would be helpful in selecting a dentist.
2. Consider getting dentures at a low-cost dental clinic. M
dental schools, for example, operate such clinics.
3. Once you have selected a dentist, make sure that you are receiv-
ing a satisfactory examination. For example, good dentists will inquire
about your medical and dental history and will thoroughly e
external structures, teeth, and gums.
4. Insist that the dentist provide an estimate of fees before any
treatment is given and an itemized bill afterward. Do not be afraid to
ask for this information before you receive dental care.
5. Finally, you should insist that before any steps, such as extrac
tions, are made, the dentist should go over the situation with you. He
should discuss alternative methods of treatment based on his examina-
tion of the condition of your mouth. Make sure that you are satisfied
with his explanation before you invest in expensive dental care.


Before purchasing a hearing aid, have your hearing examined
by an otolaryngologist (ear, nose, and throat specialist) or an otologist
(ear specialist). These people are physicians and have the expertise
and impartiality to determine whether or not a hearing aid is needed.
Hearing aid dealers do not and, unfortunately, may sometimes
prescribe unnecessary or incorrect hearing aids when alternative
treatment or no treatment is in fact required.
2. Be extremely skeptical of hearing aid advertisements which
announce "the latest electronic wizardry" and guarantee that the aid
ill "return your hearing to normal." These claims may be just
that-claims. In this regard it is interesting to note that Consumer
Reports Magazine has concluded that hearing aids available today
are "no better," so far as performance affecting speech intelligibility
is concerned, than aids tested in the pre-transistor days of 1951.
3. Before purchasing a hearing aid, check with the dealer and see
what guarantee comes with the aid. A few dealers do offer a money-
back agreement to consumers (if a dealer does agree to a money-back
arrangement, make sure you have him put it in writing). Most
dealers, however, will only allow unsatisfied consumers to exchange
hearing aids.
4. In deciding which hearing aid to buy, do some comparative shop-
ping. Don't be afraid to compare the cost of the devices among dif-
ferent dealers. This will assist in avoiding overchanging.
5. Once you have purchased a hearing aid, go through a period of
training in order to get the best use of the aid. The hearing aid itself
is not enough. Either an audiologist or a dealer can teach you how to
best use your hearing aid in different situations. In addition, you can
receive further training in lip reading and other skills that will im-
prove your hearing comprehension at a hearing clinic.

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ACO-American College of Otolaryngology, the national organization that
represents physicians who specialize in care of the ear, nose, pharynx, and larynx.
ASHA-American Speech and Hearing Association, the national organization
that represents audiologists (defined below).
Audiologist-A person who has a master's degree or the equivalent in the re-
habilitation of those whose impaired hearing cannot be improved by medical or
surgical means. It is important to note that by law, audiologists cannot provide
medical examinations or care.
Edentulous-Without natural teeth.
Hearing aid dealer-An individual who fits, sells, and services hearing aids.
Some have completed a 20-week home-study course, passed an examination
sponsored by the NHAS (defined below), and been certified by the NHAS.
Hearing specialist-A physician who specializes in hearing disorders. See
"otolaryngologist" and "otologist."
NHAS-National Hearing Aid Society, the national organization that repre-
sents and provides home-study training to hearing aid dealers.
Opthamolo ist-A physician who specializes in the diagnosis and medical and
surgical treatment of diseases and defects of the eye and related structures.
Optician-An expert who deals in the science, craft, and art of optics as applied
to the translation, filling, and adapting of opthalmic prescriptions, products, and
Optometrist-A person trained and licensed to examine and test the eyes and to
treat visual defects by prescribing and adapting corrective lenses and other optical
aids, and by establishing programs of exercises.
Otologist-A physician who specializes in that branch of medicine which deals
with the ear, its anatomy, physiology, and pathology.
Otolaryngologist-A physician who specializes in that branch of medicine which
deals with the ear, nose, pharynx and larynx, and their diseases.
Periodontal disease-Disease of the bone and tissue supporting the teeth. A
common dental disease among the elderly.

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