Judith Feder, Ph.D.
Professor and Dean
Georgetown Public Policy Institute
Policy debate about the nation’s health and retirement entitlements has generated discussion of current and future policy toward long-term care financing. Medicaid, the nation’s long-term care safety net, is at the heart of that discussion. Those who view long-term care financing as solely a budgetary issue see the primary policy question as “how to reduce Medicaid spending on long-term care,” both now and in the future. Hence the disproportionate cuts in Medicaid contained in the president’s budget and the congressional budget resolution. By contrast, analysis of people’s needs and resources indicates that the primary policy question should be “how best to strengthen Medicaid’s-or, more broadly, the government’s-capacity to assure affordable access to long-term care.” This essay provides that analysis-describing who needs long-term care, why Medicaid does-and should-provide a safety net, why expanded rather than reduced public support is essential, and what options exist for providing it. The argument, in brief, is as follows:
Today, 10 million people of all ages are estimated to need long-term care, close to 40 percent of whom are under the age of 65. Among the roughly 8 million who are in community settings, one in five report getting insufficient care, frequently resulting in significant consequences-falling, soiling oneself, or inability to bathe or eat.
The need for long-term care is unpredictable and, when extensive service is required, financially catastrophic-best dealt with through insurance rather than personal savings. But the nation lacks a policy that ensures people of all ages access to quality long-term care when they need it, without risk of impoverishment.
Private insurance for long-term care is expanding and will play a growing role in long-term care financing. However, even with improved standards and special “partnerships” with Medicaid, it does nothing for those currently in need, is not promoted as a means to serve the under-65 population and, in the future, will be affordable for only a portion of the older population-most likely, the better off.
Medicaid is the nation’s only safety net for those who require extensive long-term care. Rather than serving primarily as a deterrent to the purchase of private insurance, it serves overwhelmingly to ensure access to care for those least able to afford that insurance. But its invaluable services become available only when and if people become impoverished; its protections vary substantially across states; and, in most states, it fails to ensure access to quality care, especially in people’s homes.
” Policy “solutions” that focus only on limiting public obligations for long-term care financing do our nation a disservice. Although individuals and families will always bear significant care-giving and financial responsibility, equitably meeting long-term care needs of people of all ages and incomes-throughout the nation-inevitably requires new federal policy and a significant investment of federal funds. Options include a core program of universal public insurance, extending Medicaid to provide a national “floor” of protection for low- and modest-income people, or-more modestly-broadening Medicaid coverage of home- and community-based care with more federal financing.