Long Term Care Insurance Blog

The crystal ball says…a public long term care insurance program may, or may not, be successfully implemented in the coming years. What are your thoughts?

The folks over at the Center for Long Term Care reform seem to have their own predictions:

• No broad-based health reform will come to pass, much less reform that includes long-term care.
• Another economic “stimulus” will fail as they all do, only shifting wealth, not creating it.
• Huge increases in the federal deficit and debt will require additional borrowing to the point where interest on the public debt will crowd out new–and even much current–social spending. [President Obama announced last night a three-year freeze on discretionary spending.]
• The present economic crisis will worsen precipitating immediately problems with Social Security and Medicare unfunded liabilities ($102 trillion [now $107 trillion, 1/26/10]) that Pollyannas think we won’t confront until 2041 and 2017 respectively.
• Several states will declare bankruptcy, or whatever they choose to call acknowledging their financial insolvency. [Hello, California and New York]
• Medicare will cut reimbursements to skilled nursing facilities dramatically leaving the nursing home industry unable to meet even current standards of care access and quality for publicly financed patients. [Hello, MedPAC]
• Medicaid costs will skyrocket. After a one-time federal matching fund supplement, state and federal Medicaid programs will cut reimbursement, then benefits, and finally eligibility. Expect a new Deficit Reduction Act within five years that will make DRA ‘05 look like child’s play.
• Medicaid will not increase funding for home and community-based services significantly and Medicaid financing of nursing home care will be dramatically reduced. [Medicaid HCBS expansion slows as HCBS payments from LTC insurance expand.]
• No new federal tax deductibility for LTC insurance will pass, not even Section 125.
• Middle class and affluent people will be far more personally responsible for their own long-term care in the future.
• Within five years, reverse mortgages will become a major source of financing for long-term care.
• Within ten years, the market penetration of private long-term care insurance will have doubled at least.
• The “New, New Deal” will prove as infeasible to finance as the old “New Deal,” and the United States will slowly return to the principles that made our country great in the first place: personal responsibility, self-sufficiency, free minds, free markets, competition and risk without moral hazard.

Let’s check back in a few weeks, months and years and see where we are at. You can read more about their opinions here

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One of our most popular blog posts, rating long term care insurance companies using the Comdex ratings, generates many questions. Most recently, one came in regarding the rating of Lincoln National Corporation and thought we should share some info with our readers:

Lincoln National Corporation is one of the largest financial services companies in the country and is #32 by assets on the Fortune 500 list for 2008 (May 2009). The Lincoln National Life Insurance Company and Lincoln Life & Annuity Company of New York:

• #2 provider in life insurance sales, LIMRA December 31, 2008
• #5 largest broker-sold variable annuities, VARDS/MARC December 31, 2008
• #12 ranked total sales for fixed annuities, LIMRA December 31, 2008
• Lincoln Financial Group is the eighth largest retirement plan provider by full service plans

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Rhode Island Medicaid has embarked upon a financially risky, but potentially very beneficial reorganization of its long-term care delivery system.

The Center for Long Term Care Reform just finished speaking to their newest report on long term care in Rhode Island, “Doing LTC Right”. We’re still in the process of reading through the report but if you want see how the state of Rhode Island is working to provide better long term care for their population, feel free to read it here.

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We’ve been writing and talking recently about a report the Center for Long Term Care Reform just released, “Doing LTC Right”. The report takes a long and hard look at the state of Rhode Island and its methods of dealing with long term care. Yes, Rhode Island is a small state, so you may wonder if it symbolizes, accurately, the rest of the country in regards to long term care. As mentioned in the the report, here are a few stats about the Ocean State:

• 43rd in total population but 5th in percent of population over 85 years of age;
• 3rd in elderly with Alzheimer’s Disease
• 6th in nursing home recipients age 65 plus;
• 2nd in nursing home expenditures per Medicaid recipient;
• 39th in home and community-based services as a percent of long-term care spending;
• 44th in the ratio of family caregiving value to Medicaid cost; and
• 42nd in median household income for people age 65 plus.5

The following paragraphs provide a necessary background to the problem threatening the US:

Medicaid is the dominant LTC payer in the Ocean State. The cost is enormous and growing. Long-term care for the elderly accounts for a disproportionate share of Rhode Island’s Medicaid expenditures.

Like the U.S. as a whole, only more so, Rhode Island’s Medicaid-financed LTC is dominated by nursing facilities, which most people would rather avoid.

Likewise, access to Medicaid-financed home and community-based care, which most people prefer, is very limited–again more limited than in most of the rest of the country.

Furthermore, like most Americans, few Rhode Islanders prepare in advance to pay privately for LTC through savings, investments or insurance.

Public officials in RI recognized these problems and took creative, arguably radical, measures to address them.

What did Rhode Island do that was so radical? They designed a “global Medicaid waiver”. It could help the state of Rhode Island, and the US, reduce costs of long term care while providing better care and more choices for the public.

Subscribe to our long term care insurance blog to hear more.

In the meantime, you can download the PDF and read more Doing_LTC_RIght-1

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Over the next couple days we’re taking a hard look at a new report just released by the Center for Long-Term Care Reform, “Doing LTC Right”. You can read the full report here. In part one you’ll find:

• Executive Summary
• Introduction
• Why Does Medicaid Pay for Most Long-Term Care?
• How Medicaid LTC Eligibility Actually Works

It’s a very informative and good read. We’ll dig into it starting tomorrow, but here’s a sample from the executive summary.

• Caring for the frail and infirm elderly is difficult and expensive. Today, America’s long-term care delivery and financing system is a mess.
• The state (Rhode Island) is implementing a new system of clinical eligibility that makes more home care and less institutional care available to Medicaid recipients.
• It (the report) describes how Medicaid became the dominant payer for long-term care not only for the poor, but for most of the middle class, and many of the affluent.

We’d love to hear people chime in on this as we read thru the report.

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Starting now, we here at LTC Connects will be offering a unique, insiders perspective into the world of long term care and long term care insurance. Our goal will be to provide weekly LTC news, discussions on financing as well as events that may be of interest to those inside and outside the industry.

Many of these announcements come to us directly from the Center for Long-Term Care Reform, Inc.* so we’re often the first to hear about them. For the most part we will keep our opinions to our self, but please don’t hesitate to contact us or post comments here on our long term care insurance blog. You can also follow us on Facebook HERE and Twitter at http://twitter.com/ltcconnects as well.

• To be unveiled very soon, we’ll share “Doing LTC Right,” a report on long-term care financing in Rhode Island focusing on that state’s unique “global Medicaid waiver.” When it comes to long-term care public policy, little old Rhode Island could be the biggest state in the country!* Come back for updates.
• Check out this 8-minute NPR clip of David Walker, former Comptroller General of the USA, famous for his “Fiscal Wake-Up Tour,” talking about America’s unfunded entitlement liabilities. Listen here. Thanks to Center supporter and Regional Representative Honey Leveen (www.LTCQueen.com) for this tip.*
• A worthwhile read by CLASS Act (The Community Living Assistance Services and Supports) story here. Excerpt: “Concern is mounting about the worksite market impact of a proposed government-run plan to provide in-home, long-term care (LTC) assistance to the elderly and disabled that survived a flurry of amendments to both the House and Senate health care reform bills.”* Read the full article HERE
• Medi-Gap for LTC? Another CLASS Act article here. Excerpt: “The proposed Community Living Assistance Services and Support Act, part of the House and Senate versions of the health bill, could create opportunities for private insurers to sell products that would wrap around government plan benefits.”* Read the full article HERE

*content provided by Center for Long-Term Care Reform, Inc. Visit their website

We hope everyone finds this info helpful and/or educational. With some massive changes in how health care and long term care is managed, on the horizon, understanding these changes can have a huge impact on YOUR ability to choose a long term care insurance plan that works for you.

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