It is a service that, according to a recent CBS News article, around 7 in 10 Americans past the age of 65 will need at some point: long-term care, or ongoing assistance with daily tasks such as bathing, getting dressed, or going to the toilet. People with diabetes over the age of 60, according to the Centers for Disease Control and Prevention (CDC), are two to three times more likely than those without diabetes to experience mobility problems that may require assistance. Currently, most people who need such assistance get it from family members. But some people need a level of attention that family members cannot provide — some, of course, have no family — and 5% of all people will require five years or more of care in a nursing home. Such care can be enormously expensive, often costing more that $200 per day ($73,000 per year). Yet only about 3% of Americans have private long-term care insurance.
Because they are offered by mostly for-profit insurance companies, long-term care insurance plans in the United States tend to be affordable only for relatively healthy people who, in the company’s judgment, are unlikely to end up needing the care for which they are insured. For this reason, some politicians — led by the late Senator Edward Kennedy of Massachusetts — advocated for a federal long-term care insurance program that would be open and affordable to all people. Last year’s health-care reform law, the Affordable Care Act, established just such a program: CLASS (Community Living Assistance Services and Supports). Under the law, CLASS would be administered by the federal government but receive no outside funding — meaning that it would have to be financed entirely by the premiums that enrollees pay. Enrollment would be voluntary.
Earlier this month, the administrator of CLASS announced that the Obama administration had decided to drop the program after a financial analysis suggested that it could not be both affordable and sustainable. According to a Kaiser Health News article, the program’s mandate required that it not turn away — or charge more for — people with medical problems who are more likely to need long-term care. And since these are exactly the people who would be most likely to sign up, government analysts found that the program would have to charge between $235 and $391 per month for a $50 daily benefit. They concluded that at such a high price, few people would be likely to sign up, and the program would be bound to fail financially if it went forward.
Medicare covers short-term physical rehab services but not long-term care, leaving many families in a financial lurch when such care becomes necessary, according to the CBS News article. Medicaid, the joint federal–state program for poor people, does cover long-term care — which means that to qualify, many people pay for care out-of-pocket until they are poor, having exhausted their savings and sold any significant assets.
What do you think should be done about long-term care in the United States — is the current system of private insurance adequate? Should the government either provide long-term care insurance directly, or require everyone to buy it — just as the Affordable Care Act did for regular health insurance (with the government providing subsidies for lower-income people)? Have you, or has a member of your family, ever needed long-term care? If so, how did you pay for it? Do you have private long-term care insurance? If not, why not? Leave a comment below!