medical care that was met by insur- dence of the spread of voluntary in- points a year, with the remainder of ance beneflts is shown for the total surance in these two fields. its growth dollarwise absorbed by in- and under five different groupings. In recognition of the fact that there creases in population and rises in the The benchmarks representing ex- are many items included in the Na- cost of medical care? Are improve- penditures have been calculated both tion’s medical care bill that are cov- ments in benefits, the newer forms of to include and to omit the expendi- ered by few forms of health insur- insurance-such as dental care, out- tures incurred in the purchase of the ance, the present report includes two patient services, benefits payable in insurance protection being measured, additional benchmarks, which have nursing homes, and the like-and the so that the reader may select the con- been prepared for each year in the broader forms of coverage repre- cept of expenditures best suited to series. The first of these-the amount sented by the establishment of health his particular needs. “currently insurable under existing centers and the sale of major medical Insurance was meeting 8.3 percent forms of health insurance”-omits expense insurance going to close the of the Nation’s medical bill in 1948 the services of dentists, nurses, and gap between actual and potential pro- and 22.6 percent ‘7 years later. Since other practitioners and nine-tenths of tection more rapidly than has been 1951 this percentage has increased the Nation’s expenditures for drugs the case in the past 8 years? about 2 points a year; 1955 was no and appliances. If prepaid dental The dollar volume of voluntary exception. care expands as much as it has in the health insurance benefits--which rose In the field of hospital care costs past year or two, this benchmark may 16 percent in 1955-must increase the peak year of growth in insurance need revision. Insurance benefits about 2 percent each year merely to protection was 1951 (6.9 percentage were equivalent to 30-33 percent of keep up with population growth. If points) ; for each of the other years this benchmark in 1955, and the in- the costs of medical care continue to in the series about 2 percentage dex was two and one-half times what rise, the volume must increase even points of growth have been registered. it had been in 1948. more if the same level of protection The rate of expansion in providing The final benchmark provides a previously afforded is to be continued. protection against the costs of physi- hypothetical measure of expenditures To cover a greater proportion of the cians’ services was more rapid in the that may be considered potentially medical care bill than in the immedi- earlier years of the series-with 1951 insurable; in this measure the items ately preceding year, there must be again a peak year (5.2 percentage of expenditure included are those an increase in the dollar volume of points)-but this rate too has lev- covered on a prepaid basis by some benefits paid over and above these eled off to about 2 percentage points comprehensive plans and under some two requirements. The 16-percent in- of increase a year. forms of insurance company policies ‘crease in 1955 in the dollar volume Since most of the health insurance -that is, major medical expense poli- of health insurance benefits was only available today applies to the costs of cies and comprehensive expense poli- sufficient to increase by 1.8 percent- hospitalization and physicians’ serv- cies. Today all forms of health age points the coverage of the na- ices, the measurement’ of the impact insurance are, by one or more ap- tional medical care bill. More rapid of insurance benefits on the expendi- proaches, meeting only 30 percent of closing of the gap will require that tures for these two items provides an this benchmark of potentially insur- the Nation assign still more of its index of the value of insurance where able costs. medical care dollar to the insurance it has been most successful. The What of the future? Is voluntary industry in return for prepaid pro- rise from 15 percent in 1948 to 36 insurance going to continue its net tection for those parts of the medical percent (or 39 percent, if the expense expansion in the protection it pro- bill inadequately insured at the pres- to obtain insurance is omitted) is evi- vides at the rate of 2 or 3 percentage ent time.

lit income-maintenance program in June 1956. A6bte.sand Brief Reports Almost all the married women had Money Income Sources ceiving public assistance are taken income from one or more of the for Persons Aged 65 and into account, it appears that sub- sources under consideration, either in stantially all the 6.7 million aged their own right or as wives of earners Over, June 1956* men in the United States and more or of beneficiaries. Most of those By mid-1956, it is estimated, 9 out than four-fifths of the 7.8 million without any money income of the of 10 aged men in the United States women aged 65 and over had some types specified were widowed before and 2 in 3 of the aged women had earnings or money from a public in- their husbands had been able to earn some money income from employ- come-maintenance program (table insured status under old-age and sur- ment, social insurance, and/or a pro- 1). Since women outnumber men in vivors insurance: some of them had gram for veterans. When those re- the aged population, with about 116 income from private insurance poli- women to every 100 men, one-tenth cies, some were supported by rela- *Prepared by Lenore A. Epstein, Dlvieion of Program Research. Omce of the Commis- of all aged persons were still without Wves and some were maintained in sioner. income from employment or a pub- institutions. Bulletin, December 1956 13 These estimates relate to all aged Table 1 .-Estimated number of persons aged 65 and over receiving money persons living in the continental income from specified sources, by sex, June 1956 1 United States, Alaska, Hawaii, Puerto Number of persons Percentage Rico, and the Virgin Islands1 whereas (in thousands) distribution Source of money income r estimates presented in previous notes / and articles in this series related to Total Men women Total Men Women the continental United States only. --- -___-~ -__ _- Total aged 65 and over ’ .._._. .___. ___._.... 14.550 6,720 7,830 100.0 100.0 100.0 Since aged persons in these four Ter- __- ritories and possessions number only Emnlovment .._.. _. __.. . . .-_ _. .______-_ .._._ 4,260 2,570 1,690 29.3 38.2 21.6 Earners....-.--..-...... ---.--.--..-..-...---.. 3,310 2,570 740 22.7 38.2 9.5 about 122,000, the findings on income Earners’ wives not themselves employed.. _. 950 6.5 _. 12.1 sources are essentially the same for Social insurance and related programs 4 ._ .~ 8.E 4,150 3,940 55.6 61.8 50.3 Old-age and survivors insurance.. .- __-. ._ _. 6.640 3.390 3,210 45.4 50.4 41.0 the total as for the continental United Railroad retirement insurance.... ___. ._ ___ _ 520 270 250 3.6 4.0 3.2 Clovernment employees’ retirement programs. 480 290 190 3.3 4.3 2.4 States.? Most of the differences are Veterans’ compensation and pension programs.. 710 450 266 4.9 6.7 3.3 Beneficiaries’ wives not in direct receipt of within the margin of error of the es- benefits ______-_-___-- .____... __.....____. 220 220 1.5 2.8 Public assistance 5__.._._. -.. _. .-. _. _-. .__ 2,570 1,000 1,570 17.7 14.9 20.1 timates. The number of aged old-age No money income or income solely from other and survivors insurance beneficiaries sOU~C~S...... ~~..~~...... ~.....~.~....~.... 1,520 70 1,450 10.4 1.0 18.6 per 1,000 aged population is slightly Income from more than one of specified sourcesw 1,890 1,070 820 13.0 16.9 10.5 higher for the continental United Employment and social insurance or assistance 1,340 760 580 9.2 11.3 7.4 Social insurance and public assistance.-. _. 550 310 240 3.8 4.6 3.1 States than for the total, however, and the old-age assistance recipient 1 Persons with income from sources specified may Virgin Islands. also have received money income from other sources, 4 Persons with income from more than one of the rate is slightly lower. Puerto Rico such as interest, dividends, private pensions or annu- progrsms listed are counted only once. In addition and the Virgin Islands, which account ities, or cash contributions from relatives. to the programs shown, unemployment insurance 2 The sum of the persons shown under the 4 cate- programs provided beneats for some 65,000 men aged for almost three-fourths of the aged gories exceeds the number in the population by the 65 and over and 15.000 aged women. Workmen’s estimated number with income from more than 1 of compensation snd temporary disability insurance population in the four Territories and the 3 main sources. The estimates of persons with programs also provided income for some, but infor- income from more than 1 source, developed from sur- mation is lacking ks to the number. There is no bnsis possessions, were not covered under vey data, are subject to sampling variability (which for est.imnting the overlap with other programs. the Social Security Act until 1950. As may be relatively large Ior the smaller estimttes) and b Old-age assistance recipients and persons aged 65 to such errors as may result from nttempts to adjust and over receiving aid to the blind. Includes some a result, many of their men and for developments since the sample surveys were con- 15,000 persons receiving vendor payments for medical women who are now aged had no op- ducted. They are not entirely consistent with those care but no direct cash payment. previously published in the Rz~Zleti,a because of the Source: Estimated in the Division of Program portunity to qualify for old-age and aveilabilitv of some new data and slight chances in Research on the basis of published and unpublished methodology. data from the Bureau of the Census and agencies survivors insurance, and large num- a Number of aged persons in the continental Uni- administering income-maintenance programs. ed States, Alaska, Hawaii, Puerto Rico, and the bers need assistance. t The broader data used for these re- (about 60,000 in June) who receive ment. The number of benefits with- ports on money income sources begin- benefits because they have child held because of employment has been ning with June 1956 correspond more beneficiaries in their care, and (2) declining, however, as a result of the closely than did those for the conti- counts only once aged persons re- liberalized retirement test provisions nental United States with the sum- ceiving a benefit both as a retired of the 1954 amendments. In June mary statistics regularly issued on worker and as the spouse of a retired 1956, for example, benefits were with- Social Security Administration pro- worker (54,000, mostly women, in held because of employment from gram operations. They are still June) .3 only 141,000 male old-age benefici- slightly smaller, however, than the Benefits under the old-age and aries, or less than 4 percent of the totals shown for aged beneficiaries in survivors insurance program provided number entitled, whereas 2 years the program statistics issued regu- a basic resource in June 1956 for earlier about 188,000 benefits, or 7 larly. The reasons are that the series about 3.4 million aged men and 3.2 percent, were suspended because of used in this note (1) excludes aged million aged women. In 1956, for the employment. beneficiaries living abroad (some 43,- first time, old-age and survivors in- Information on the proportion of 000 in June, and wives under age 65 surance beneficiaries represented half old-age and survivors insurance bene- of all aged men and two-fifths of all ficiaries who are employed or self- 1 The size and age distribution of the aged women in the population. It is employed in any given month has un- civlllan populatlon in the four Territories noteworthy, also, that at the begin- fortunately not been collected since and possessions are estimated by the Bu- reau of Public Assistance on the basis of ning of the year an additional 1 mil- the national survey of beneficiaries in the most recent data available from the lion aged men and 200,000 aged 1951. A rough estimate has been de- Bureau of the Census. It has been assumed women were fully insured under the veloped for mid-1956 from data on for purposes of thls analysis that the sex program but not drawing benefits, the decline in the number with bene- and marital-status distributions of the aged In these areas are the same as shown by characteristically because of employ- fits suspended because of employ- the 1950 Census and that changes since ment, from Bureau of the Census re- 1950 in the relative number of the aged s Beginning December 1955, persons re- ports on changes in the labor-force with employment have paralleled those in ceiving both an old-age beneflt and a participation rate, and from data on the continental United States. widow’s, widower’s, or parent’s secondary income sources for aged veterans and ‘JBstimates for the continental United benefit have been included in the summary States for June 1956 have also been pre- program statistics only in the count of old- their survivors compiled in 1955 for pared by the Division of Program Research. age beneficiaries. the President’s Commission on Vet-

14 Social Security erans’ Pensions (Staff Report Num- cause of the large number of World crease, however, in the proportion of bers VIII and Xl. It appears proba- War I veterans reaching age 65 each the aged for whom assistance pay- ble that about one-sixth of the aged year and the liberal qualifications for ments are provided as a supplement men and nearly one-seventh of the receipt of non-service-connected dis- to old-age and survivors insurance aged women receiving payments un- ability pensions when a veteran passes benefits that are at or near the mini- der one or more of the social insur- age 65. Between mid-1950 and mid- mum or are insufficient to cover spe- ance or related programs in June 1956 the number of World War I vet- cial needs, such as need for medical 1956 also had some income from em- erans aged 65 and over in receipt of care. It is estimated that, in June ployment. The new calculations sug- compensation or pension benefits ex- 1956, only 10 percent of all aged men gest that estimates of the size of this panded more than tenfold, from and 17 percent of the aged women in group at the end of 1955, as previ- 30,000 to almost 330,000. During the the United States were on the public ously published, were probably under- past 2 years, the percentage increase assistance rolls and did not also re- stated by as much as one-fifth and in the number of aged persons re- ceive a social insurance benefit. possibly by more. ceiving veterans’ compensation or The significant gains during recent There is no current estimate of the pension benefits has even outpaced years in the relative number of aged number of persons receiving benefits the percentage growth in the number persons with some money income under private retirement plans. Avail- of aged beneficiaries of old-age and from employment or a public income- able evidence suggests, however, that survivors insurance. maintenance program are encourag- considerably more than 1 million aged Of the 1.9 million aged persons who ing but should not be misinterpreted persons (including aged wives of pen- benefited under a program for rail- as indicating that the income prob- sioners) were receiving private pen- road workers, government employees, lems of the aged have been resolved. sion income in mid-1956 and that al- or veterans, it is estimated that more Almost by definition the more than most all of them were old-age and than 400,000 were also receiving old- 2.5 million receiving old-age assist- survivors insurance beneficiaries. Thus age and survivors insurance benefits ance have a marginal level of living. roughly 1 out of every 6 old-age and in June 1956. The number of aged The earnings of many of those with survivors insurance beneficiaries re- persons receiving benefits under one income from employment are rela- ceived benefits under a private retire- or more of the social insurance or vet- tively small-necessarily so, of course, ment plan to supplement his social erans’ programs therefore totaled for those drawing retirement benefits security check. about 8.1 million, representing more -but others too have low earnings; Compensation and pension pro- than three-fifths of the men aged 65 relatively large numbers are employed grams administered by the Veterans and over and half of the aged women. in agriculture, and many have part- Administration in June 1956 pro- Unemployment insurance benefits time or irregular employment. Accord- vided direct benefits for about 450,000 under State and Federal programs ing to the Bureau of the Census sur- aged. men and 250,000 aged widows were paid in June to some 80,000 vey of the labor force, 26 percent of and dependent mothers of veterans. aged persons, of whom about four- the aged men and 41 percent of the The wives of veterans, unlike the aged fifths were men. Some aged persons aged women who were at work in non- wives of old-age and survivors in- also received benefits under tempo- agricultural industries during the week surance and railroad retirement ben- rary disability insurance and work- of June 10-16.1956, worked fewer than eficiaries, do not receive benefit men’s compensation programs, but 35 hours. Although attention here checks, but veterans receiving com- statistics are not available as to the i-, directed at income sources in 1 pensation for service-connected disa- number, and consequently they can- month, it is worth noting that many bilities receive additional compensa- not be included in table 1. Moreover, aged persons work only part of the tion for dependents if the disability information is lacking as to the pro- year. Of those who worked at some is rated 50 percent or more. In this portion of beneficiaries under these time during 1955, more than one-fifth analysis it is assumed that the wives programs who also had income from of the aged men and more than one- of other married veterans share in other sources. fourth of the aged women reported their income, as do the nonemployed While the old-age assistance rolls employment (even part-time) for less wives of earners and of retired gov- have been dropping fractionally than 27 weeks during the yearG4 ernment employees. month by month since late 1955, old- Of the aged persons receiving re- The Railroad Retirement Act and age assistance remains an important tirement benefits under old-age and retirement programs for Federal, resource for aged persons, particu- survivors insurance in December 1955 State, and local government employ- larly those without insurance rights (when the average payment was less ees each provided direct benefits for under old-age and survivors insur- than 2 percent smaller than the av- roughly half a million aged persons ance. In mid-1956 about 2,520,OOO erage beneilt received in June 19561, in June 1956. The rate of increase in aged persons received some or all of one-third, or about 1.5 million, had a the number of aged persons receiving their income under this Federal-State monthly benefit of less than $50, and benefits under these programs has program, and some 50,000 received three-fourths had less than $80. Of been much slower than the rate of payments under other public assist- increase in the number benefiting ance programs, principally aid to the 4 Bureau of the Cen.Sus, Current Powdation under the programs for veterans be- blind. There has been a steady in- Reports, Series P-50, No. 68.

Bulletin, December 19.56 15 the aged women who received widow’s ceding year (the latest for which ing monthly benefits under old-age benefits, more than half (some 400,- there are Bureau of the Census data and survivors insurance increased 000) received less than $50, and more on the incomes of families and un- more than 620,000. At the close of than three-fourths less than $60. related individuals) 55 percent of the the fiscal year, monthly benefits were Though old-age assistance provided families with money income entirely being paid to at least one person in supplementary income for some of from sources other than earnings re- each of 6.2 million families (table 1). those with small benefits, only about ported income of less than $1,500 and Retired-worker families, which made 500,000 aged insurance beneficiaries 38 percent reported less than $l,OOO.fi up 77 percent of the total, numbered also received an old-age assistance Of all persons living alone (or with 4.7 million-about 517,000 more than payment. An estimated 200,000 old- nonrelatives) who had no earnings a year earlier. The number of sur- age and survivors insurance benefici- but had some nonearned income in vivor families increased 103,000 to aries also received compensation or 1954, half received income of less 1.4 million. pension payments under the programs than $800. Though these data are Average family benefits at the end for veterans and their survivors. For for all families and for persons living of June 1956 showed moderate in- non-service-connected disability and alone, or with nonrelatives, who had creases from the corresponding aver- death pensions there is an income some money income but no earnings ages a year earlier, because of (1) limitation, but the largest old-age in 1954, they are suggestive of the the rising proportion of benefits com- benefit payable under old-age and money income position of the retired puted on the basis of earnings after survivors insurance is less than the aged. 1950 and (2) the increasing number allowable income limit. There is no computed under the provisions of the income limitation for service-con- 6 Current Population Reports. Series P-60, 1954 amendments that .permit, in No. 20 (December 1955). nected disability compensation and the computation of the average survivor benefits, but relatively few monthly wage, the dropping of up to of the veterans entitled to service- 5 years of lowest covered earnings connected disability compensation are Family Benefits in and, in addition, any period of total aged 65 and over. Current-Payment disability. As noted above, roughly one-sixth Payments to retired workers with- of the old-age and survivors insur- Status, June 30, 1956 out dependents also receiving bene- ance beneficiaries had private pen- During the year ended June 30, fits averaged $65.60 for men and sion income in mid-1956, but avail- 1956, the number of families receiv- $50.70 for women. The average for able evidence suggests that persons entitled to benefits under a private Table 1 .-Estimated number of families and beneficiaries in receipt of benefits, and average monthly benefit in current-payment status, by family group, retirement plan characteristically re- end of June 1956 and 1955 ceive old-age and survivors insurance benefits that fall in the upper portion [In thousande, except for average benefits; data corrected to Nov. 8, 19561 of the benefit range. The private June 30. 1956 June 30, 1955 plans seldom provide separately for I - dependents or survivors. Family clessif?cation of heneficisries AVerage Average According to the most recent data Jumher I nonthly Number Number nonthly of ,f hene- 3mount of of hene- amount from the Bureau of the Census on the lamflies iciaries Per families Eciaries Per family family annual income of persons5 half of all --- __. -_--- __ men aged 65 and over who had some I- Total. _ _ _ ._ ._ . . _._. . . ._.. ._ _. . . . 6.1F0.2 8.374.5 . . . . 5.539.7 7.563.5 money income in 1955 received less -__ Retired-worker families% _ . . .._ .._._... 4.731.9 G,114.4 .._. 4,214,s 5.462.3 than $1,337 from all sources. The Worker only..-...... ~...... ~...... 3,461.3 3.460.3 %: ii 3,067.7 3,067.7 Male...... ~.-.~~~....---. 2.148.4 23148.4 50.70 y;m:; 1,9R2.3 %: ii effect of full and partial retirement Female--~..-.....-...-..-..-..~..-...- 1.311.8 1,311.E 1,105.4 48.40 on size of income is highlighted by Worker and wife aged 65 or o~er...... ~ 1.182.fl 2.365.2 104.80 11066.4 2,132.8 102.20 Worker and wife under age 65 I...... _. .3 102.50 the fact that the median income in Worker and aped dependent husband-.. 10.7 21:: 113.3088.20 9:; 18:: 87.09 Worker and 1 or more children- ...... 16.6 42.7 101.00 15.8 41.1 98.10 1955 of aged men with year-round, Worker, wife aged 65 or over. and 1 or full-time employment-comprising more children~...... -...... -. 1.3 4.0 132.30 1.2 3.6 123.30 Worker. wife under we 65. and 1 or barely one-fourth of the aged men more children ...... y... __.____. __.. 60.1 220.1 121.10 54.0 197.7 117.cQ with income-was two and one- Survivor families ..______. -.- .__.__.__._. 1.428.3 2,260.l ___. ____ 1.324.9 2.101.2 quarter times as large as the median Aged widow ...... _.... -.- _... -_. 746.3 746.3 49.00 688.3 638.3 46.60 Aged dependent widower. .-. ..___.._._ 1.1 1.1 48.20 1.2 1.2 40.00 for all men, or more than $3,000. For Widowed mother only I_...... _._...._ 51.20 1.4 1.4 43.60 Widowed mother and 1 child _...._. 12d 256:: 108.50 120.8 241.6 105.10 women aged 65 and over, who rarely Widowed mother and 2 children..m.-..m 85.7 257.2 137.80 83.6 250.7 132.60 Widowed mother and 3 or more children 82.4 389.8 136.40 75.6 356.1 129.90 work full time the year around, the Divorced wife and 1 or more children.... 135.70 .2 130.00 median money income, apart from 1 child only...... --....-.. 217:: 217:; 48.50 200.3 200: ! 47.80 2 children. ._ _. _. _.._ ._ _.__. .._. __.._ __. 90.0 179.9 83.80 80.9 161.9 81.60 support provided by their husbands, 3 children. ._ _. _. .-~. _. ._. ._. 31.8 95.3 105.20 29.1 87.2 101.00 4ormorechildrenmm.- _...... _. . .._. 20.2 89.3 112.20 19.6 86.3 105.60 was only $700 in 1955. For the pre- 1 wed dependent parent...... ___. -_.. 22.8 22.8 59.50 22.2 22.2 48.10 2 aged dependent parents. -. ..-.- . . . .._. 1.5 2.9 95.30 1.7 3.3 92.90 5 Current Population Reports, Series P-60, No. 23 (November 1956). 1Benefits of children were being withheld. 16 Social Security