The Role of Long-Term Care in Health Reform

CAP Action’s Judy Feder and Professor Harriet L. Komisar testify before the U.S Senate Committee on Finance. Read the full testimony  (CAP Action).

I am pleased to testify before you today on the need for public action to improve long-term care services and supports. I know you share my view that the nation’s economic stability depends on the well-being of its families and that support for people impaired in the tasks of daily life is crucial to that well-being. Sadly, that support is sorely lacking under current policies.

Both during the presidential campaign and since the election of President Obama, we’ve heard much about the need for health reform as critical to restoring prosperity for families and the nation’s economic and fiscal health. Not only is health reform essential to assuring affordable health care for all; it is also essential to slowing cost growth in our health entitlement programs, Medicare and Medicaid.

But we cannot achieve health or fiscal security unless health and entitlement reform address the need for affordable long-term care. Mr. chairman, you alerted the Congress and the nation on the importance of long-term care reform as well as health reform when you chaired the U.S. Bipartisan Commission on Health and Long-term Care Reform—the Pepper Commission—20 years ago. However, families’ problems have only gotten worse ever since.

People with health problems that create both acute and long-term care needs do not distinguish between the two when it comes to finding or paying for care: Both threaten their health and financial well-being. Our current entitlement programs serve people who need both sets of services. About 16 percent of Medicare beneficiaries are eligible for both Medicare and Medicaid (“dual eligibles”), more than half ofwhom need long-term care. More than a third of Medicaid expenditures are devoted to long-term care services—at home and in the community as well as in nursing homes. We cannot effectively address the needs of people served by these entitlement programs—or their costs—without addressing responsibility for financing long-term care.

Sadly, the mythology about long-term care that the Pepper Commission report sought to counter has continued to impede effective long-term care policy. We still hear claims that the need for long-term care only arises when people get old, that it happens to just about everybody, and that it is the responsibility of individuals and families simply to “plan ahead” and take care of themselves or their family members “when the time comes.”

Such claims egregiously misrepresent the reality of long-term care needs and the extraordinary commitments families make to address them.

  • The need for long-term care is not limited to older people. Of the more than 10 million people estimated to need long-term care in 2005, about four in ten were working-aged adults or children. Simply telling families to “plan ahead” is useless for the millions of people who experience disability at a young age.
  • Even among older people, the need for extensive long-term care varies considerably. Among the population turning age 65 today, three in ten are expected to die without needing any long-term care. By contrast, one in five will need five or more years of care. In terms of expenditures, half the people turning age 65 today can be expected to live their lives without spending anything on long-term care; another quarter are expected to spend less than $10,000 (in present discounted value). At the other end of the spectrum, 6 percent can expect to face over $100,000 (in present discounted value) in long-term care expenditures.
  • Far from avoiding responsibility for long-term care, it is families whom most people need long-term care count on for support. Unpaid care provided by family and friends accounts for an estimated 85 percent of the care people are receiving at home. That care comes at enormous cost to overtaxed caregivers, both in economic opportunities foregone and in health burdens associated with care giving.
  • And, despite substantial effort, even extensive family care too often leaves significant needs unmet. The last public survey of unmet need for long-term care found one of every five individuals at home and in need of care going without care they needed—and facing increased risk of serious health consequences as a result: falling, being unable to eat, bathe, or dress, or soiling themselves.

The problem with today’s long-term care system is not that individuals and families fail to take enough responsibility; instead, they simply do not have enough to give. The need for extensive long-term care is an unpredictable and catastrophic risk. For instance, in health care, we rely on insurance to “spread” such risks—having a large population contribute to a fund that is then distributed to the minority for whom catastrophic risk becomes a reality. For long-term care, instead of insurance, costs are concentrated on the individuals and families of those who use service, backed only by a public program (Medicaid) that finances care—primarily nursing home care—as a “last resort”—only after they have spent virtually all they have.

CAP Action’s Judy Feder and Professor Harriet L. Komisar testify before the U.S Senate Committee on Finance. Read the full testimony  (CAP Action).