• “With Medicaid, Long-Term Care of Elderly Looms as a Rising Cost”

    Everyone involved with Medicaid was high-fiving when President Clinton put Medicaid on the table in his nomination speech down in Charlotte. Yet a poignant New York Times story shows that there’s work to be done.

    Proposals to bloc grant and cut Medicaid are more concrete, more immediate, severe, and more likely to actually happen than are the various Medicare premium support proposals that receive the most action in the 2012 campaign. This imbalance of political attention highlights the reality that retirees are (with the possible exception of the wealthy) the single most powerful voting bloc in the country. Our political economy powerfully resists any genuinely toxic retrenchment of social insurance for this group.

    Conventional political wisdom holds that Medicaid is a different story. The GOP platform’s reference to Medicaid under the rubric of “welfare reform” speaks volumes. No politician would dare link the words “Medicare” and “welfare” in the same sentence, even with the modifier “reform” stuck in to soften the blow. Yet as Aaron emphasizes–and as President Clinton implicitly noted—the political conventional wisdom is missing something. Two-thirds of Medicaid spending goes to the elderly and disabled. In Medicaid’s financial mechanics (if not its public persona), the program serves millions of middle-class people and their families. One cannot impose large Medicaid cuts without affecting these constituencies.

    President Clinton did not note one of the worst continuing failures in health care policy, which remains largely unaddressed after health reform.  That would be long-term care.

    The Affordable Care Act includes technical provisions to improve long-term care, including a long-overdue office to coordinate policies for nine million “dual-eligible” men and women who receive both Medicare and Medicaid. Long-term care services account for about one-third of the Medicaid budget.  ACA also included the CLASS act, a worthy effort to address disability issues, which is now on hold. I’m not exactly sure what happened with CLASS. Howard Gleckman notes that CLASS is a sadly missed opportunity. It has powerful opponents in both parties. It also faces serious actuarial questions that remain to be resolved.

    Meanwhile, the human problems of long-term care have not been effectively addressed. Yesterday’s New York Times’ Nina Bernstein contributed a heartbreaking story about one family that could be told, in broad outline, about millions of others.

    Seniors like Rena Lull, 92, who spent the last of her life savings on $250-a-day nursing home care near Cooperstown, N.Y., last year, will face uncharted territory if Republicans carry out their plan to replace Medicaid with block grants that cut spending by a third over a decade.

    The move would let states change minimum eligibility, standards of care, and federal rules that now protect adult children from being billed for their parents’ Medicaid care.

    I know something of this. $250-a-day is roughly the financial burn rate for my brother-in-law’s care. Even on my six-figure university salary, we could never pay these bills. We are very grateful that Medicare and Medicaid shoulder this financial load.

    Ms. Bernstein’s New York Times story notes the importance of the 2012 election in potentially making these problems worse, Yet no matter who is elected, these issues will be difficult for the federal government, states, families, and health care providers.  Moreover, public policies enacted by both political parties have already failed to protect millions of families like Rena Lull’s:

    Now, like a vast majority of the nation’s 1.8 million nursing home residents, Mrs. Lull, a retired schoolteacher with dementia, counts on Medicaid to cover most of her bill. But her daughter Rena, 66, also a retired schoolteacher with a lifetime of savings, no longer knows what she can count on in her own old age.

    “I get choked up thinking about this,” she said, recalling how her widowed mother had depleted $300,000 on five years of care in the community and one year in the Otsego Manor nursing home, before qualifying for Medicaid. “I’m so scared about what’s going to happen to me.”

    This is a disgraceful failure of our public and our private insurance systems. Someone works her entire life to support herself in retirement and to accumulate a nest egg for their children—only to lose it all and become a pauper due to chronic illness.

    Long-term care services account for about one-third of the Medicaid budget.  Yet the current state-federal partnership works especially poorly in this sensitive area. My colleague Donald Taylor and others have suggested more effective ways to address these problems. These approaches must be financially sustainable and credible, too.

    People shouldn’t lose their homes if they get cancer. They shouldn’t lose everything if they get dementia, either.  That’s precisely the sort of life-disaster a decent social insurance system is designed to prevent.

    The challenge of long-term care will likely worsen as our population ages.  It’s a looming cost. It’s a lot more than that. It’s another looming problem our political system seems unable to squarely address.

    @haroldpollack

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    • Do the extant block-grant plans (in particular Ryan’s) in any plausible way avoid dropping LTC coverage for at least some seniors, or making rates so inadequate they lose access?

      If not, it seems like it would actually be fair for Obama (or more likely Priorities USA) to release ads accusing Romney/Ryan of going to kick seniors out of nursing homes.

      • $250 a day is an unheard of bargain in NYC. Average is $350 a day. My Mom’s is $375. We will be taking her home as soon as the 100 days of insurance run out. Dementia, diabetes, so will she even get to go home?!

    • This is simple for the repubs to solve: States will pass laws requiring children to pay elder support, just like they pay child support. Persons who don’t support their parents will be sent to jail. Elder support will be non-dischargeable in bankruptcy. If you can’t pay the debt will build and build until the parent dies. It won’t matter that you had terrible or neglectful parents. Everyone with parents will have to pay.

      • It is not clear to me why, as a general principal, children should not be asked to contribute to their parents’ support. Admittedly, asking children to pay the entire cost of nursing home care could be onerous, but asking them to pay nothing at all seems hard to justify when public budgets are becoming severely stretched. At one time, expectations of support from children were common:

        http://www.ssa.gov/policy/docs/ssb/v17n4/v17n4p3.pdf

        One consequence of asking children to help support their parents might be that they would then become advocates for better public policies for financing long-term care, perhaps like those in Germany.

    • Note to Bruce H, above:

      Child support is about $1000 a month…………elder support is at least $6000 a month if the parent is in a nursing home. Most adult children do not earn $6000 a month in total.

      Why not do what Germany did in the 1990′s? Add about 2% to the Medicare payroll tax, and cover long-term care through social insurance?

      Bob Hertz, The Health Care Crusade

    • “Shirley, who is 71, has lupus, and has never worked. She and Ken’s father split up in 1990, and her support largely dried up when he died, soon after the divorce. She’s since amassed a credit card debt totalling $28,000 and is seeking $250 per month from [her son] Ken and an undisclosed sum from three of his siblings.” http://lifestyle.ca.msn.com/family-parenting/moms-dads/rogers-article.aspx?cp-documentid=24682220

      When I was in business in my 30s and 40s, I got advice on how to “creditor-proof” some of my assets; little did I realize that those creditors could include my parents (both since deceased). I can imagine the surprise of huge numbers of baby boomers when served with a writ from a trustee for a parent with Alzheimers, for hundreds of thousands of even millions of dollars in nursing home care.