As state long term care Partnerships advance, legislators and insurance departments in the states will need to have a stronger understanding of these programs, according to a panel of long term care experts.
The panel had words of advice for legislators during the spring meeting here of the National Conference of Insurance Legislators, Troy, N.Y.
Speakers examined how uniformity would help reciprocity among state programs and emphasized the need for making these partnership programs work.
“There is phenomenal traction on this,” said Sandy Praeger, Kansas insurance commissioner and president of the National Association of Insurance Commissioners, Kansas City, Mo.
Indeed, according to statistics provided by the U.S. Department of Health and Human Services, there are 12 states where Partnerships are currently operating, including the original 4 to implement programs: California, Connecticut, Indiana and New York. The others are: Florida, Idaho, Kansas, Minnesota, South Dakota, Nebraska, Ohio and Virginia.
In addition, 10 states are planning to implement these programs: Iowa, Colorado, Georgia, Montana, North Dakota, New Jersey, Nevada, Oklahoma, Oregon and Pennsylvania.
Five states have plan amendments pending: Arizona, Michigan, New Hampshire, Texas and Wisconsin. And 8 have development activity underway: Illinois, Kentucky, Massachusetts, Maryland, Maine, Montana, Tennessee and Vermont.
Praeger offered some statistics to underscore the importance of LTC insurance in general and of the Partnership programs in particular:
One in 3 Medicaid dollars goes toward paying LTC expenses;
In 2004, $193 billion was spent on LTC services, and nearly half was paid by Medicaid; and
Only 7% of total LTC expenses, or $14 billion, is provided through LTC insurance contracts.
Partnership programs are important because they will free up state assets for those that really need them, said Praeger. The costs currently being paid out by Medicaid are “not sustainable,” she added.
“Baby boomers are set to run through their IRAs or 401(k) funds,” according to Hunter McKay, social science analyst with the Office of the Assistant Secretary for Planning and Evaluation of the U.S. Department of Health and Human Services, Washington.
In the future, “it may be a very different picture,” McKay said. “I’m not sure that folks will ever have the funds that they have now.” But major health events “can knock one out of a comfortable retirement and make them a Medicaid client.”
Still, “the market we are after is trying not to hear us,” he said. “To date, a number of states are very concerned, but this is not going to work unless we have reciprocity. People won’t buy it. How do we make sure that eligibility issues in the states will make this happen?”
Another problem he raised is the differences in Medicaid requirements among states and how much training agents actually need. “How far down the road do you actually take them?” he asked.
“Long term care Partnerships are not a panacea, but may be part of the solution,” according to Bonnie Burns, a representative with California Health Advocates, Scotts Valley, Calif.
A major difficulty, however, is that “no states do anything alike,” she said. “Partnership products are very different from state to state.” What is needed, she continued, are “strong state standards and standardized Medicaid disclosures.”
Other points that states need to consider, she added, include:
State-approved curricula and compliance procedures;
A firm understanding of Medicaid benefits and how they work;
A minimum number of required hours and courses for providers;
Monitoring of cross-selling efforts by agents;
An awareness of claims handling and denied claims as well as rescissions, termination of contracts with return of premium; and
The creation of uniform definitions among states.
State Rep. George Keiser, R-Bismarck, N.D., noted, “Wait until you move to another state. Where in the world will the oversight be?”
He noted that the state in which the Partnership LTC contract was purchased would retain authority over insurance regulation and determine reciprocity rules with other states’ Partnership programs. On the other hand, he added, the state a contract holder moves to would determine Medicaid requirements when the contract holder is ready to participate in the Partnership program.