Health reform proposal could threaten long-term care, Pitt researchers say
A Republican health reform proposal threatens federal money that cushions many people against the $60,000-per-year costs of long-term care as they age, according to three University of Pittsburgh researchers.
A bill that is making its way through the House of Representatives would set per-person caps for the amount of Medicaid funding the government sends to states. Because Medicaid primarily pays for medical treatment for the poor and disabled, many people don't realize money from the program goes toward long-term care for people whose life savings have run out.
Pitt Health Policy Institute Director Everette James, associate professor of medicine Walid Gellad and graduate student researcher Meredith Hughes posted an analysis of the program Thursday on a blog for the journal Health Affairs.
The authors cite a Congressional Budget Office estimate that two-thirds of elderly Americans will need help paying for long-term care in their lives.
“I don't think it's something that people think of as something that they might need,” Hughes said of long-term care. “A lot of people are aware of health insurance and the issue of going to the doctor, but for most people this is not something that's going to be an issue until you're a lot older. And they think that when they are older, they will have Medicare.”
But Medicare only pays for long-term care — whether it is in a nursing home or at home — for 100 days following a hospitalization, Hughes said. And the $60,000-per-year average cost of long-term care can quickly eat up the average American household's retirement savings of about $109,000, she said.
After depleting their savings, people are eligible for Medicaid, which covers long-term care costs at nursing homes and, in most states, at people's homes. Medicaid pays more for long-term care than any other type of payment in the United States, covering 43 percent of long-term care costs in 2015, according to Centers for Medicare and Medicaid Services data.
Medicare paid 19 percent of the costs; out-of-pocket funds covered 13 percent; and private insurance covered 9 percent, according to the data.
The market for private, long-term care insurance has struggled in recent years because only people who think they might need it buy it. That drives up prices because there aren't enough healthy people in the risk pool paying premiums, Hughes said.
The paper encourages lawmakers to take the opportunity during health reform efforts to improve long-term care support programs. They suggest finding ways to stabilize the private insurance market, refocusing long-term care dollars from Medicare and Medicaid on lower-cost community-based services and adding support for the 17 million people who provide care for aging family members.
Wes Venteicher is a Tribune-Review staff writer. Reach him at 412-380-5676 or firstname.lastname@example.org.