The SCAN Foundation has brought about 200 long-term care (LTC) policy specialists to Washington this week to try to wake the United States up and get it off of the demographic train tracks.
The foundation — which was created by a nonprofit California health plan that tries to provide “soup to nuts” care for Medicare enrollees — is trying to create a “sustainable continuum of quality care for seniors.”
One of the key questions for seniors is, “Who will care for us?” the foundation says in a description of its mission.
The foundation is trying to get members of Congress and others to understand what the insurance advisors who help consumers with long-term care (LTC) planning already know: That the need to plan for the need for LTC services is at the poorly understood, poorly supported center of the world’s financial universe.
Governments throughout the world — in Asia, in Europe, in North America, and even in “developing countries” with seemingly low average life expectancies — are suddenly facing a challenge that no other major national governments have had to face in quite the same way ever before: The likelihood that a relatively small population of “working age” workers will somehow have to support a large population of “old old people” who have disabilities that interfere with their ability to handle major “activities of daily living.”
The workers also may have to help support many older people who need expensive, close supervision because of Alzheimer’s or other forms of dementia.
The Chicago Health and Aging Project has estimated that the cost of acute health care and LTC services for people with dementia will total about $203 billion, this year alone, just in the United States. That total does not include the cost of informal care provided by friends and relatives. The total could rise to $1.2 trillion by 2050, the center researchers estimated.
The package of papers released in conjunction with the SCAN conference includes looks at topics such as Medicaid nursing home benefits eligibility requirements, government long-term care insurance (LTCI) programs, ways to shore up the private LTCI system, and ways to get employers involved with helping their workers plan for LTC expenses.
Here is a sampling of what the LTC policy specialists were saying.
What’s out there now
Eileen Tell, an executive at Univita Health, a home care management company, gave attendees an overview of the many different public and private LTC financing options that exist today, ranging from private LTCI coverage to Medicaid to private LTCI to hybrid insurance products.
Tell tried, for example, to explain what she believes to be common misconceptions about the options.
Even private disability insurance and the Social Security Disability Insurance system could be viewed as LTC financing options to some extent, but public and private disability insurance “are designed to partially replace lost income and are not sufficient to cover both living expenses and LTC,” Tell said.
“We as a society, and each of us as individuals, must address the challenge of funding future LTC needs,” Tell said. “While there are several ways to meet this need, they all have limitations. Also, despite government initiatives to raise awareness of the risks and costs of LTC, and the efforts of business people to educate consumers about how their products can help, most people have taken no steps to plan and provide for their future needs. Why not?
“The most important reason is probably denial — most people simply do not know the risk of needing LTC or the potential costs they face. Lack of knowledge is also a factor. Many individuals have misconceptions about the cost of care and how they can meet these future financing needs.
“Others are informed about the products and have considered some of them, but have concerns about their limitations and value and so have not taken action. In some cases, the complexity of products and the array of choices may keep potential buyers from reaching a decision.”
Richard Frank, Marc Cohen and Neale Mahoney developed a paper on expanding the private LTCI market that was presented at the conference by Frank.
Frank and Mahoney are health policy researchers at Harvard. Marc Cohen is chief research and development officer at LifePlans Inc., a health risk management firm.