Congress should help workers save for ordinary retirement costs and the cost of long term care at the same time.

Greg Jenner, an executive vice president at the American Council of Life Insurers, Washington, made the case for that position Wednesday at a hearing of the House Energy and Commerce Subcommittee on Health.

“Private insurance currently pays for 8% of total nursing home expenditures but 36% of overall health expenditures,” Jenner said, according to a written version of his testimony. “There is clearly a large gap in the financing of long term care services that private insurance can fill.”

One way Congress could foster use of private LTC financing alternatives is to approve changes in federal laws that would permit insurers to include long term care insurance in an annuity contract, Jenner said.

An annuity-LTC hybrid provision is already in the House version of the pending pension reform bill, Jenner noted.

If the provision becomes law, workers could use the income from an annuity to cover retirement costs, or, if necessary, use the annuity to pay for long term care services, Jenner said.

Another witness, Karen Ignagni, president of America’s Health Insurance Plans, Washington, asked Congress to promote improvements in the quality of long term care.

Congress can help by supporting systems for measuring and reporting LTC system quality, Ignagni said.

Congress also should support performance-based payment systems, efforts to take consumer satisfaction into consideration, and health literacy programs, Ignagni said.

Ignagni also repeated AHIP support for measures such as creating an above-the-line federal income tax deduction for LTC insurance premiums and allowing employers to offer LTC insurance through cafeteria plans.