As the debate over health care reform heats up in Congress, it’s important for legislators to know that a truly comprehensive reform bill must include long-term services and supports.
The textbooks define long-term care as the broad array of services and supports people need when they can no longer completely care for themselves. Long-term care services and supports include: help with bathing, dressing, or with household tasks like cooking and cleaning. Other services outside the home include adult day care; home health care; skilled nursing care; and more. These services and supports may be provided by a person's family members or by paid caregivers.
The debate over health care reform has focused primarily the 46 million Americans uninsured for acute care. But real reform must also deal with vulnerable populations, especially the individuals with disabilities and seniors with chronic diseases. Real reform must include funding for long-term services and supports.
According to the U.S. Census Bureau, there are about 38 million Americans over 65. By 2050, thanks to the rapidly aging baby boom generation, that number is expected to rise to 88.5 million. In January 2011, the first of the baby boomers will start to become eligible for Medicare.
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Most of those baby boomers assume that Medicare pays for long-term services and supports. It doesn't. Nearly 250 million people in this country are uninsured for long-term services and supports.
Our major “insurance plan” in the United States is Medicaid, which currently covers about half of all funding for these services. To become eligible for Medicaid, an individual must “spend-down” income and assets, essentially becoming impoverished and remaining in poverty for as long as he or she needs supports, often for a lifetime.
Consider the typical situation of an 83-year-old woman -- let's call her Louise -- who breaks her hip. She receives a hip replacement in a hospital, recovers in a skilled nursing facility, gets therapy at home and then hires aide to drive her to the grocery store, help her get dressed, and assist with other daily activities.
Louise would view this scenario as one event; not several.
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But our health care payment system doesn't see it the same way. Louise's hospital stay and rehabilitation would be covered by health insurance, but not the help she needs at home. For this, she would have to drain her savings and ask her children to help before public assistance would step in.
Consequently, it is mostly people and their families who are paying for expensive care. A skilled nursing facility room costs more than $68,000 per year, while assisted-living facilities generally charge over $32,000 annually. Most certified home health care providers are paid more than $30 per hour.
This financial burden spills over to businesses, too. According to the MetLife Caregiving Costs Study: Productivity Losses to U.S. Business, employees that are also caregivers cost businesses an average of $34 billion per year in lost productivity.
In addition, state governments’ budgets are crumbling under the weight of Medicaid. On average, the cost of long-term services and supports alone accounts for about 10 percent of entire states’ budgets. As the aging population grows, those costs are expected to double by 2025 and triple by 2045.
There is insurance for long-term services and supports available on the private market, but only one in five Americans can actually afford it. And many are excluded from coverage because of a pre-existing condition.
What about the rest of us?
Well, Sen. Kennedy and the Senate Committee on Health, Education, Labor and Pensions (HELP) unveiled the Affordable Health Choices Act, which would create a national insurance trust that would pay a cash benefit to help the elderly and people with disabilities pay for support services. People would enroll in the program during their working years and begin paying premiums. To collect benefits, a person would have had to pay premiums for at least five years.
Other health care bills are expected to emerge from both sides of Congress. The American Association of Homes and Services for the Aging (AAHSA) believes that as Congress works to finalize a bill to present to President Obama, legislative leaders and committees must include funding for long-term services and supports. We cannot have comprehensive health care reform with out provisions for long-term services and supports. Proper funding of these vital services will help individuals, families and state governments. We must make it affordable to care.