Here at AgingOptions, we’re acutely aware of the fact that there is a long-term care crisis brewing in America. Through the people we connect with via seminars and radio, or among clients at our partner LifePoint Law, we hear from seniors many times each week who are seriously worried over the costs of long-term care. Many of these men and women are from middle-income households, with too many resources for traditional Medicaid but nowhere near enough to cover assisted living or skilled nursing care on their own for very long.
The overall solutions to the crisis are complex, costly, and controversial. Nevertheless, because the issue is so relevant today, we wanted to call your attention to this recent NextAvenue article by columnist Michael Pessman, gerontologist at Chicago’s Rush University Medical Center, who paints a bleak picture as he sounds the call for both government and private initiative to manage the explosion of need for affordable long-term care. It’s a sobering read, but an important one.
COVID Pandemic Exposed Flaws in Long-Term Care System
Writing for NextAvenue, Pessman begins with an assessment of the pandemic’s effect on long-term care. COVID, he says, reminded us of the high financial cost of long-term care, but it did more than that: the pandemic “exposed shortcomings in how we manage the care itself, including the quality of facilities, quantity of beds, scheduling of staff and a lack of commitment to improving the system.”
It is Pessman’s informed opinion that reform of the entire system of long-term care needs to be at the very top of the federal government’s policy agenda, especially as our society rapidly ages. “Reform should emphasize expanding coverage and strengthening connections with the broader health care and public health systems in order to create equity,” he writes. “ A 2021 report by four leading researchers details this, and other advocates of long-term care reform agree with it.”
Most of Today’s 65-Year-Olds Will Require Care
“Every day in the U.S.,” Pessman explains, “10,000 people turn 65, and the number of older adults will more than double over the next several decades to top 88 million people and represent over 20 percent of the population by 2050.” The effects of having so many seniors aging together is obvious, he adds. “The government has forecast that more than half of the adults turning 65 today will eventually require long-term assistance with daily activities such as eating, dressing and bathing.”
Pessman is clear in his conviction that accessing this essential care should not be “a personal financial challenge” for any person who needs it. Achieving that degree of access will demand a complete re-think of the mathematics of long-term care.
Long-Term Care Facilities Saw One-Quarter of COVID Fatalities
Besides the financial cost of long-term care, there’s also a human toll brought into sharp focus by the pandemic. In a 2022 report from the Kaiser Family Foundation, it was found that “long-term care facility residents and staff cared for more than 201,000 COVID-19 patients who died, accounting for at least 23 percent of all COVID-19 deaths in the U.S.” Amazingly, according to this article in Scientific American, residents in long-term care facilities make up barely one percent of the U.S. population.
As a fall and winter COVID surge seems inevitable according to the Centers for Disease Control, the importance of addressing the accessibility and the quality of long-term care insurance on a national level appears quite urgent.
Skyrocketing Costs Put Families at Risk
The costs of long-term care are daunting. Pessman writes, “The national annual median cost of care ranges from more than $108,000 per year for a private room in a nursing home to $20,280 per year for five-days-a-week adult day health care services, according to the Genworth Financials’ 2021 Cost of Care Survey. A semi-private room costs $7,756 a month, or $93,075 per year.”
He adds, “The average length of stay among all nursing home residents is 485 days, according to a February 2019 report from the National Center for Health Statistics.”
Pessman understands firsthand the struggle to pay for such care. As a Rush University Medical Center gerontologist, he has encountered plenty of older adults and their families deeply concerned about financial struggles at the end of their lives. “Several families have told me they are taking out reverse mortgages, spending down their savings and tapping retirement accounts to pay for long-term care,” he writes. “When an individual is part of a married couple, this can be tricky. If they must pay private health care for their sick spouse, the healthy spouse often expresses concern about maintaining his or her lifestyle.”
For many, this can ultimately mean the total depletion of their hard-earned estate and the complete inability to pass any assets along to their children.
Medicare, Medicaid, and Long-Term Care
A common misunderstanding among many Americans is to assume that Medicare covers long-term care costs. Pessman explains, “Some Americans reportedly think Medicare covers long-term care. But it only covers up to 100 days of care in a skilled nursing facility for each ‘ benefit period,’ which begins the day you check into a facility and ends 60 days after you check out.” In reality, Medicare’s short-term coverage typically ends well before the 100-day period, leaving unprepared families scrambling for care.
Pessman adds, “If someone needs more than 100 days of such care in a benefit period, they will need to pay out of pocket. For patients whose coverage days are running out, they must either pay with private funds or have a Medicaid application pending to avoid being forced out.” Of course, that only applies to nursing homes that do accept Medicaid, which many do not.
For those lower-income patients who qualify, Medicaid pays for skilled nursing care (but not assisted living). Still, the qualifications are strict. “Medicaid coverage isn’t available to middle-class older adults with a household income of $17,609 or more for an individual in 2020,” says Pessman.
In his NextAvenue column, Pessman notes that Obamacare (officially The Affordable Care Act) was originally intended to include a long-term care insurance program. However, that provision was swiftly repealed because the premiums did not cover the cost of care. Several state programs, including Washington’s, have run up against similar cost issues.
In spite of the problems and pitfalls, Pessman did express some optimism, and he writes that several long-term care alternatives are very much “in play”, as Pessman puts it. He goes into detail about the various related bills in front of both the Senate and Congress; if you are interested, we highly suggest you read the original article for the specifics since we lack the space to cover them here.
Questions About Structuring a Program
As with any problem this complex, Pessman implies, the legislative devil is in the details. “Policy experts differ over how best to structure a federal long-term care insurance program,” he writes. Should a long-term care program at the federal level be totally public or a public-private hybrid? How much of the cost should employees shoulder if a program is workplace-based? Should participation be mandatory or voluntary? Is long-term care coverage limited or universal?
Then, he adds, there’s the challenge of pricing a program so that it will be sustainable. “It will be tough to fund the program while avoiding the actuarial pitfalls that have driven so many private long-term care insurers out of the market,” he notes with irony.
Fortunately, there are several possible models to follow, both at home and abroad. Overseas, we can look to Japan, Germany, the Netherlands, Denmark, and France, all of whom have expanded social insurance programs, or already provide universal long-term coverage. And domestically, several states – notably Illinois, Michigan, Minnesota, and Washington State – have experimented with long-term insurance plans that Pessman calls potentially promising “models for a national program.”
Alternatives to Institutional Care
Because research shows that older adults more easily thrive in their homes and communities and do better with access to friends, family, and familiar surroundings, Pessman insists, “As an alternative to institutional care, any federal long-term care insurance program needs to encourage the use of home and community care. Nursing home care is significantly more expensive than home and community-based care.”
He adds, “State governments can receive grants from Medicaid — the government’s largest long-term insurer — in order to help older adults stay at home. In the past few years, more than 90,000 older adults have benefited from grants by obtaining in-home care instead of moving into nursing homes.”
We feel it best to conclude using Pessman’s own words: “There is no easy solution to the nation’s long-term care crisis, but policymakers must address it. America can no longer be a country where older adults are forced to sacrifice their dignity and health in order to survive because they can’t afford the care they need.”
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(originally reported at www.nextavenue.org)