The crisis facing long-term care is getting the attention of the president and members of Congress, raising hopes among stakeholders that reform might be on the way.
Demand for long-term care has increased in recent years as the aging population grows, and a wave of baby boomers retire in coming decades.
But as of now, the long-term care system is failing to meet the needs of the current population. It’s fragmented, expensive and often inaccessible for low-and-middle income aging adults and people with disabilities. While most people are cared for at home by unpaid caregivers, lawmakers have looked to expand access to home and community services covered by Medicaid, the largest payer of long-term care in the U.S.
“Long-term care is in a real crisis in this country,” said Rep. Debbie Dingell (D-Mich.), who is working on legislation to expand access to home-and-community based services (HCBS.)
“There’s no meaningful long-term care coverage in the U.S.,” said Dingell, who noted that she is one of the “lucky ones” who has private long-term care coverage.
A friend advised her to buy a policy when she was younger. But most people don’t have that option. They can’t afford the premiums—Dingell said hers are thousands of dollars per month.
“The need doesn’t go away” just because people can’t afford it, she said.
Long-term care is typically defined as support or assistance for people who need help with daily living needs, like dressing, bathing or eating—most commonly needed by aging adults and people with intellectual or developmental disabilities. These services can be offered in institutions like nursing homes or in people’s homes or communities through assisted living or adult day care centers.
About 14 million adults are in need of long-term care support and services as of 2019, according to a report from the nonpartisan Congressional Research Service (CRS.) About 60% of people will need assistance with daily needs like dressing or driving to appointments at some of their lives, according to the Administration on Aging.
The fact that 40% of COVID-19 deaths occurred in nursing homes has forced lawmakers and families to reconsider care for aging adults and people with disabilities.
“The pandemic has really shown a spotlight on long-term care and the need to address issues within the system,” said Rhonda Richards, senior legislative representative in government affairs at AARP.
Most seniors don’t use Medicaid to pay for long-term care because they make too much to qualify for it. But for those who do qualify, it’s critical, albeit flawed, advocates say.
While Medicaid covers stays in institutions like nursing homes and home healthcare for people with low-incomes and some people with disabilities, coverage of most other home and community based services that help people stay in their homes—like bathing, dressing, and meal preparation, are optional for states to cover, and expensive for patients and families to pay for out-of-pocket. Most people are cared for
More than 800,000 people are on wait lists for HCBS services covered by Medicaid.
Advocates caution the number of people on wait lists isn’t a good measure of how many people need care – thousands more people are cared for in nursing homes or by unpaid caregivers. And demand will increase as the aging population grows and better technology and medical care help people with intellectual and developmental disabilities live longer.
President Joe Biden has proposed $400 billion investment in HCBS, which will likely be included by Congress in the upcoming infrastructure bill, potentially through an increased FMAP to states tied to increased pay for workers and move more people off of the wait lists.
But some lawmakers are taking a long-term look at the issue.
Legislation being worked on by Rep. Dingell, Sens. Bob Casey (D-Pa.), Maggie Hassan (D-N.H.) and Sherrod Brown (D-Ohio) would make coverage of HCBS mandatory under Medicaid, in an effort to eliminate the institutional bias that experts say the current structure supports.
Under a draft version of the HCBS Access Act, coverage of integrated day services, personal care attendants, direct support professionals, home health aids, private duty nursing, homemakers, chore assistance, companionship services, support for caregivers and many other services that help aging adults and people with disabilities stay in their homes would all be mandatory under Medicaid.
States would receive a 100 % FMAP to cover those services.
Reforming Medicaid coverage of long-term care is a great first step, experts say, but it leaves out millions of people who don’t qualify for Medicaid but also don’t make enough money to pay for care out-of-pocket.
“There are millions of people like that, who are just middle income people. They worked hard all their lives and did the right thing, but they never could save enough, so if they need long-term care in their old age, they just can’t afford it,” said Howard Gleckman, a senior fellow at the Urban Institute.
Private long-term care insurance isn’t very popular, likely due to high premiums, with only 7.5 million Americans covered, according to the American Association for Long-Term Care Insurance.
The vast majority of those people will be cared for by family members—unpaid caregivers whom studies show can experience negative financial, mental and physical impacts during the period they are helping their relatives.
“There’s a cost to the family caregivers in society, which is not insubstantial,” Gleckman said.
Some people spend down their savings and assets until they’re poor enough to qualify for Medicaid coverage of long-term care services. In many states, people who have more than $2,000 are not eligible for Medicaid.
Rep. Jan Schakowsky (D-Ill.) said she wants to look at ways to get more people qualified for Medicaid coverage. People shouldn’t have to make themselves destitute in order to qualify, she said.
“There may be ways, especially when looking at asset limitations, that we can include more people,” she said.
Dingell said “We are working closely with stakeholders to ensure that we’re making long-term care and HCBS as widely available as possible.”
Gleckman has recommended a public insurance program that helps people pay for long-term care, similar to what is offered in other countries like France and Germany.
People would pay into it over the course of their lives, like Social Security.
A draft bill by Rep. Thomas Suozzi (D-N.Y.) would create a federal long-term care insurance program, funded by payroll taxes.
“We have no system in this country to pay for long-term care right now,” said Katie Smith Sloan, president and CEO of LeadingAge, which represents thousands of nonprofit organizations providing services for aging adults, including adult day centers, assisted living, home care and nursing homes.
“Right now, most care is paid for by family members who deplete their savings, or older adults themselves, they deplete their savings, become impoverished, and go on Medicaid.”
A public financing system, like one proposed by Suozzi could “help people pay for the services they need in the setting that makes sense for them,” she said.
With the focus on expanding access to Medicaid coverage of HCBS, some worry nursing homes will be left out of the picture.
Some people will just not be able to live at home, even with additional help, and nursing homes need help to modernize and better care for patients, experts say.
Low-Medicaid reimbursement rates have resulted in a chronic underfunded of nursing homes, leading to low pay for workers and high staff turnover, which leads to poor patient outcomes.
A program set up by the Trump administration rewarded nursing homes that met certain quality metrics during the pandemic. They’ve also received funding from the HHS Provider Relief Fund.
But Congress doesn’t appear to be seriously considering additional investments for nursing homes. Biden’s proposed infrastructure plan didn’t mention them at all.
AARP, LeadingAge and the for-profit nursing home industry have all called on Congress to appropriate more money for improvements.
“We would argue that, yes, we do need money for home and community services, we do need money for affordable housing, and technology support, which are all in the President’s proposal. But not at the exclusion of nursing homes. We need all of those services.”