G. Lawrence Atkins, Federal Commission on Long Term Care and National Academy of Social Insurance
Organizing the delivery and financing of long-term services and supports (LTSS) for people with significant cognitive and physical functional limitations has been a challenge in the U.S. for decades. Most of the LTSS is provided by family caregivers, but when people need paid services and supports for an extended period they encounter an array of services and providers that can be confusing, frustrating and expensive. Although the cost of an extended period of LTSS is an insurable risk, this country does not have a well-structured financing approach that protects people or enables people to adequately protect themselves against this risk. Families and individuals can exhaust their resources paying for LTSS and then have to turn to Medicaid for help. Medicaid, which today finances two-thirds of paid LTSS, is a major expenditure for federal and state governments that is projected to intensify as LTSS needs double with the aging of the baby boom.
The Commission on Long-Term Care was created, as part of budget legislation passed in January, to find solutions to the difficulties families and individuals have in accessing and financing LTSS. The law gave the Commission six months, a mix of Democratic and Republican appointees, no appropriation, and a charge to issue a comprehensive plan. With only three months and limited resources after funds were appropriated, the Commission collected substantial expert and public input and achieved a broad bipartisan agreement on a vision statement and 28 specific recommendations that will provide a strong foundation for additional work that needs to be done.
The Commission articulated a shared vision of a fiscally-sustainable and effective service delivery system built around concepts of person- and family-centered care, a well-trained and adequately supported array of family caregivers and paid workers; with a comprehensive financing approach that would balance public and private financing to insure the most catastrophic expenses, encourage savings and insurance for more immediate LTSS costs, and provide a strong safety net for those without resources.
In line with this vision, the Commission recommended building a system with a better balance of home and community-based and institutional care options; integrating LTSS and medical care; developing a uniform assessment tool in support of the LTSS care plan; ensuring consumer and caregiver access to information; encouraging family caregiver engagement and support; improving caregiver training; involving caregivers in care planning and care coordination; and improving LTSS quality through outcomes-focused care management. In addition, the Commission made recommendations to improve access to Medicare SNF and Home Health benefits, provide support through Medicaid for working adults with LTSS needs, and allow families to save through tax-favored accounts for an individual’s LTSS expenses.
Development of a credible “big solution” on LTSS financing was not possible due to limitations on time, resources, and a dearth of actuarial work in this space. The Commission agreed that part of the LTSS risk is an insurable risk for which adequate insurance is not currently available. Insuring the catastrophic portion of this risk would place a cap on individuals’ financial exposure and make the remaining risk easier to finance through savings or private insurance. It is relatively easy to imagine a social insurance design or a private insurance reform in the abstract that might insure the catastrophic risk, but designing a workable program that would meet the very different needs of both the under- and over-age 65 disabled populations, would have affordable financing through taxes and/or premiums, and would be fiscally-sustainable over the long run is another matter. Existing data is insufficient to estimate the size of the risk that would be insured and the amount of financing that would be needed, and to model options that might work. It is even more challenging to develop a financing approach that could gain broad support and be implemented in the context of existing fiscal constraints – particularly in light of the challenge that remains to sustainably finance Medicare.
Instead, the Commission put forward two alternative approaches that offer some detailed thoughts on accomplishing the shared financing vision– one reliant primarily on private-sector mechanisms and the other reliant primarily on public-sector mechanisms. The two alternatives are more concepts than proposals – providing a sense of how it might be done. Either will need more work before policy proposals are ready for serious consideration.
Even without a single big financing solution, the Commission’s Report lays a solid foundation for a more substantial effort to develop credible comprehensive LTSS solutions. It establishes that there is common ground, including a broadly-shared vision for LTSS service delivery, workforce and financing. It identifies policy changes that could be pursued in the short term, and points the way to more substantial changes that will need further development.
To take the Commission’s recommendations to the next level, the Commission called for establishing a national advisory committee on LTSS that would work directly with federal agencies; and convening the 2015 White House Conference on Aging in conjunction with the National Council on Disability to focus in part on LTSS improvements. The most important consequence of the Commission’s work would be a sustained effort to keep a focus on these issues and bring stakeholders and policymakers together in preparing concrete, fiscally-sustainable proposals that could move forward in the Congress.