This document, the second in a series of three which present the text of Senate hearings on catastrophic health insurance, focuses on the impact of catastrophic health insurance on consumers and health care providers. Testimony is included by these witnesses: (1) Senator Pete V. Domenici; (2) Wilbur Cohen, professor of Public Affairs, University of Texas; (3) William Hutton, executive director, National Council of Senior Citizens; (4) John Denning, president, American Association of Retired Persons; (5) John P. McDaniel, president, Midlantic Health Care Group; (6) Ruth Constant, president, Port Arthur Home Health, Beaumont Home Health and Wichita Home Health, Victoria, Texas; (7) Paul Willging, executive director, American Health Care Association; (8) Jerald R. Schenken, member, Board of Trustees, American Medical Association; (9) Richard Materson, president, American Academy of Physical Medicine and Rehabilitation; (10) Gary Shorb, president, Regional Medical Center at Memphis, Tennessee; (11) J. E. Stibbards, chairman, Board of Trustees, National Association of Children's Hospitals and Related Institutions; (12) Doris Nash, public affairs director, Cancer Care, Inc.; (13) Camilla M. Miller, member, Board of Trustees, National Alliance for the Mentally Ill; and (14) Shervert Frazier, Medical Director, McClean Hospital (Massachusetts). Prepared statements by Senators George J. Mitchell, John Heinz, and John H. Chafee are included. A comparison of the selected Medicare catastrophic insurance bills is presented. (ABL)