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LTC Bullet:

U.K. Should Consider Center's Plan

Wednesday March 24, 1999


The March 22, 1999 "Elder Law Fax" reports that the United Kingdom's Royal Commission on Long-Term Care of the Elderly has recommended that the elderly be given free care in nursing and residential homes, rather than being obliged to sell their homes to cover the costs. The Commission said, however, that those residents who can afford to pay for their room and board should do so.

While charity groups support the immediate implementation of the Commission's recommendations, others don't agree.

"Elaine Murphy, Chair of the City and Hackney Community Services NHS Trust in London, wrote in the British Medical Journal that the Commission report failed to make a 'visionary leap' by giving to the elderly what they really want.

'Elderly people increasingly want the dignity of choosing for themselves the type of care they receive by buying it rather than having "assessed care packages" doled out by social services,' Ms. Murphy writes. 'The commission's proposal smacks of outdated paternalism that tomorrow's elderly people will not need, expect, or want.' [Moreover] 'providing public funds, irrespective of income, would transfer wealth to better off members of society and their heirs at the expense of those most in need.'"

Currently, U.K. residents are responsible for the cost of their care if their estate is worth more than 16,000 pounds, or roughly $26,000. The Royal Commission's report recommends raising the threshold to 60,000 pounds (about $100,000).

The Elder Law Fax points out that "by contrast, in the United States, to qualify for Medicaid nursing home benefits a person may only have $2000 in cash assets but can have a home of any value. However, in most states, after the person's death that home is subject to the State's claim for Medicaid paid."

The Elder Law Fax fails to mention, however, that taking advantage of Medicaid eligibility rules to qualify non-poor seniors for taxpayer-financed care is the specialty of the Medicaid planning bar. In addition, Medicaid planners help these same clients avoid estate recovery on the back end of the process. Estate recovery, mandated in federal law but poorly enforced by the states, is intended to recoup the cost of care from the estates of deceased Medicaid recipients (after the death of the last surviving dependent relative) in order to preserve the money in the system for others in need.

Center for Long-Term Care Financing Vice President, David Rosenfeld, recently confirmed in a conversation with a U.K. attorney that similar antics are popular on the other side of the pond as well.

The Center for Long-Term Care Financing can help. The conceptual framework of the Center's "LTC Choice" proposal offers a better solution to finance long-term care in the U.K. than the one offered by the Royal Commission. "LTC Choice" empowers seniors to purchase the type of care they desire in the private marketplace, while preserving scarce public dollars for the genuinely needy. With the proper public policy in place, most seniors will purchase private long-term care insurance to avoid any involvement by the government. Others will be given a line of credit on their estates so the government can provide the extra dollars seniors may need to purchase the kind of care they want, again in the private marketplace, rather than receiving less than optimal care in underfunded nursing homes.

The principles underlying the Center's "LTC Choice" plan apply in the U.K. as much as they do in the U.S. or anywhere else. Taxpayer-financed long-term care for everyone (1) raises grave access and quality of care issues; (2) destroys any incentive to take personal responsibility to obtain the best care in the most appropriate setting; and (3) carries frightening fiscal consequences for countries facing an aging baby boom bulge -- like the U.S. and U.K.

You can purchase a copy of the Center for Long-Term Care Financing's "LTC Choice" report for $24.95 (free to media) by contacting Nadia Morgen at 206-447-1340 or by sending your order in a reply e-mail.

Elder Law FAX is published weekly by Timothy L. Takacs, Certified Elder Law Attorney. You can subscribe to Elder Law FAX by sending an empty e-mail to: