Receiving the proper care and being able to afford it rank at the top of people's concerns about getting older. Meanwhile, long-term care and support services represent a growing unfunded liability for the U.S. government.
Studies have concluded that roughly 70 percent of older Americans will require an extended period of long-term care at some point in their lives. Such care is needed for daily activities, including bathing, toileting, dressing, walking and eating. These care expenses are not, contrary to the belief of many people, covered by Medicare insurance. They are covered by Medicaid, but seniors are not eligible for this program until they have spent nearly all their assets.
Private long-term care insurance is purchased by less than 10 percent of seniors, according to the National Bureau of Economic Research. Besides being expensive, it often does not come close to paying for someone's long-term care needs. In the past few years, some large insurers have stopped selling new policies, and other insurers have sharply raised their rates.
The lack of a coherent plan to help the nation's rapidly growing pool of seniors afford long-term care was a major reason why Congress approved a new long-term care insurance program in 2010 as part of the health care reform law.
The program was voluntary and would have offered long-term care insurance for a modest price. The program was not designed to come close to paying a person's full care expenses; it was developed and sold to legislators as a reasonable way to add a layer of needed protection that could, in combination with private insurance and personal savings, help seniors.
However, the coverage benefits and voluntary option combined to doom the program before it ever started. The government pulled the plug on the program and said it was not financially feasible. As a concession to advocates of stronger long-term care programs, a 15-member Commission on Long-Term Care was created to assess the need for services and make recommendations about future policies. However, the group was provided with little funding and had only 100 days to issue its findings. The group's preliminary report was released late last week, and was approved by a 9-6 bipartisan vote of the commissioners.
The preliminary report largely skirted issues of new funding for long-term care needs. Instead, it called for a wide range of incremental improvements in how seniors and younger people with disabilities are served by Medicare and Medicaid as well as pilot programs to test new ways of providing services. It also said more attention needs to be given to the roles and needs of paid caregivers and family members who provide unpaid care.
Bruce Chernof, chair of the commission and CEO of the SCAN Foundation, a nonprofit that focuses on health care needs for seniors, told U.S. News that the group's work was limited by the short 100-day deadline. "It is a more complicated problem than we could address in 100 days," he notes, adding that a successful solution to senior care needs has eluded Congress and the White House for decades.
"We were able to sit down and develop a thoughtful document," Chernof says. He notes there was bipartisan support for the report, and there was strong agreement that this work was "an important down payment" on developing more specific future actions to address the growing needs of seniors and their families for workable care solutions. He says the full report, to be published soon, will include discussion of financing alternative ways to pay for improved long-term care solutions.
The five Democratic appointees who did not approve the majority report issued an alternative set of recommendations. They called for a new government social insurance program, higher wages for caregivers and the commitment of new financial resources from the government.
"The need for extensive and expensive long-term services is a catastrophic risk for people both under and over age 65," Judy Feder, one of the five dissenting Democrat commissioners, said in a statement. "Today, neither private insurance nor public programs protects us against that risk."
Feder said in an interview with U.S. News that her group issued its alternative recommendations because it felt the commission's report failed to substantively address needs to provide more long-term care financing. "We didn't feel they addressed the financial question," she says, adding that in their view, financing is the most significant challenge to improved long-term care services.
The rest of the proposals are "pretty much sweetness and light," she says. "Without the financing, you really haven't achieved anything. It's the ball game."