America’s long-term care (LTC) system is broken. It fails many of the people who receive care, and it discourages responsible planning when people are young and middle-age. The system also fails home health and nursing home workers, who endure challenging and sometimes dangerous work.
Before adopting a new government program or considering additional regulation, policymakers need to ask an essential question: How did the U.S. LTC system become so dysfunctional?
Today, Paragon Health Institute provides an answer in “Long-Term Care: The Problem,” a research paper by Stephen Moses—the President of the Center for Long-Term Care Reform. Stephen has studied long-term care policies for more than four decades, and his paper for Paragon diagnoses the problems with the LTC system and highlights key realities for policymakers.
As Stephen explains in the paper, Medicaid is the primary reason aging Americans have had few other choices other than nursing home care for decades. Medicaid, a welfare program, has exploded in costs over the past few decades. As the baby boomers age and increasingly need LTC services, many seniors with LTC needs receive poor quality care despite the explosive costs.
The next paper, “Long-Term Care: The Solution,” will be published early next year and will provide a set of reforms to address the problems caused by misguided government policies.
You can find “Long-Term Care: The Problem” and an executive summary here.
Summary of the Long-Term Care Problem
LTC consists of a wide range of medical and social services that people require when they are unable to take care of themselves. People are likely to need such services as they get older, and America’s population 85 years and older is growing and will increase rapidly over the next few decades. The government finances almost three fourths of the nation’s growing LTC expenses.
The biggest public misperception, held by average citizens as well as many experts, is that Medicaid LTC eligibility requires impoverishment. The reality is that most elderly Americans qualify for Medicaid even if they have significant wealth. In addition to numerous exempt asset allowances, like a home and retirement account, there are many ways for people to impoverish themselves or their older parents artificially to qualify for Medicaid while preserving all or most of their wealth.
Easy access to publicly financed LTC creates a moral hazard that discourages young, healthy, and affluent Americans from saving, investing, or insuring for LTC. As a result of easy access to Medicaid, the market for private LTC insurance has largely failed to materialize.
Given the surge of Medicaid enrollees on LTC, the government has been forced to pay meager rates, which has resulted in low-quality care and difficulty attracting staff.
Entrepreneurs have developed more attractive, private alternatives such as assisted living and private-pay home care. But these alternatives have struggled due to the bias in government policy toward Medicaid-financed nursing homes.
In “Long-Term Care: The Problem,” Stephen tackles all the above issues and more.
All the best,
Brian Blase
President
Paragon Health Institute
