Cost of Long-Term Services and Supports (LTSS)

Regardless of setting, the cost of services can be significant, which is why many state and federal policymakers have been reluctant to take on the issue of financing LTSS (Long Term Services and Supports). For example, in 2014 the average annual cost for a home health aide was approximately $45,800, the cost for community-based adult day-care centers was on average $16,900 per year,7,8 and the average annual cost to live in a nursing facility was approximately $87,600.9 In 2013, national spending for formal LTSS (i.e., services from a paid provider) was about $310 billion, with Medicaid spending accounting for about $123 billion (51 percent) of this amount.10 Formal LTSS spending for older Americans (65 years and up) was approximately $192 billion in 2011.11

Take-Up of Private LTCI Long-Term Care Insurance

Today, private LTCI accounts for a small proportion of LTSS spending. In 2012, there were about 5 million to 5.5 million individual LTCI policies in force and about 2 million to 2.5 million policies in the group market. The number of insured lives has been relatively flat since the mid-2000s, and annual sales of individual policies have declined sharply since the early 2000s. The number of carriers issuing new policies has decreased significantly since the early 2000s.23 Insurers made incorrect assumptions when establishing premiums for earlier generations of LTCI policies and found them to be unprofitable without substantial rate increases; many left the market due to continued uncertainty about whether the product will ultimately be profitable, among other reasons. There are about a dozen companies actively selling in the individual market, down from more than 100 in the early 2000s, and fewer than eight selling in the group market.24

Blogger comment:

These are statistics presented in support of the recommendations by the Bi-Parisian Policy Center (BPPC) on Long Term Care insurance (LTCI)  fund Long Term Services and Supports (LTSS) for funding State and Federal Long-term care insurance in the future.

Inevitably, due to the Baby Boomers, Medicare and Medicaid and Private Long Term Care Insurance will not be adequate to fund Long Term Care Services and Supports.  The effort by the (BPPC) is proposing LTCI funded by State and Federal budgets that exceed the current Medicare and Medicaid funding.  Either through higher taxes or increased withholding taxes for LTSS using the dwindling long term care insurance  or would be offered to younger participants to purchase for later LTSS.    The CLASS ACT portion of the Obama OCA was to provide home and community and long term care services  (HBCS) for this purpose but was repealed due to lack of s funding source.  Now, to circumvent that problem, the BPPC is recommending the sale of LTCI by the State and Federal Government ,with deductibles and coinsurances, to younger participants using a rudimentary acuity scale for actuaries to estimate the long term out of pocket for the Government and the beneficiaries; which they are reluctant to publish because it will always be understated for our unhealthy baby boomers.  No mention of prevention or self-health responsibilities of every American

My question is … why not properly fund Medicare for restorative services either at home, community or provider based in a continuum using an episodic pricing model requiring cost accounting by episode?  Do away with Medicaid that uses spend down methods to bankrupt the elderly and their families for catastrophic illnesses.   Then allow the families to buy Medic-gap policies for themselves and their parents to cover the deductibles and coinsurance already in place for Medicare Part A and B.  Do away with the insurance company art C replacement Medicare policies and Part D the legalized drug Act as the rip offs that they are.  Then make Part A and B available for extended stays beyond the rehab period to provide restorative services (nursing, medications, therapies, social services, nutrition, discharge planning) with a discharge rate back to the community based services (HBCS) of 57%.  The remaining LTSS would be provided by long term care providers (nursing homes and assisted living facilities) funded by private LTCI purchased by the families from health insurance companies using episodic prices based on costing for accountability and quality measures.

This blend of private and tax withholdings eliminate the dependence on Medicaid and will balance the State and Federal budgets now to be bankrupt for the shift of every new enrollee to Medicaid by 2050. with no accountability for the alternative Medicare Part C policies and  Part D pharmaceuticals.   Not only is Government control ineffective it is so inefficient … taking 35% TO 40% of our caregivers’ time for paperwork.  And the so called transparency is an oxymoron since the money has already been wasted … too late for true accountability.  Leaving us all at risk of being caught in the enforcement trap of civil money penalties and allegations of fraud and abuse to make the bureaucrats jobs safe and sound.