LTC Bullet:  LTC Almanac Update, #2

Friday, July 25, 2014

Auburn, Alabama—

LTC Comment:  For the second time in two weeks, we’ve updated the “Almanac of Long-Term Care” in The Zone.  More on the LTC Almanac and today’s update after the ***news.***

*** TODAY'S LTC BULLET is sponsored by Claude Thau, a GA whose insight into sex-based pricing can help you secure referrals. His proprietary sales tools enable clients to make informed final decisions about buying LTCi in 15-20 minutes, let you test a client's interest in a combo product immediately, and change work-site LTCi from a proposal-delivery process to interactive consultation. The lead author of the Milliman Broker World LTCi Survey, Claude was named one of Senior Market Advisor’s 10 "Power People" in LTCi in 2007 and Chaired the Center for Long-Term Care Financing. Test Claude by calling 800-999-3026, x2241 or email him at to ask questions or get references. ***

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*** SEVENTH NATIONAL Medicare Supplement Insurance Conference announced by Jesse Slome and the American Association for Medicare Supplement Insurance.  It will take place April 13-15, 2015 at the Hilton Hotel, Lake Buena Vista in Orlando.  Details here. ***



LTC Comment:  Center members know and appreciate our "Almanac of Long-Term Care" in The Zone, our password-protected website. 

*** SPECIAL:  We are making access to The Zone, including the "Almanac of Long-Term Care," free for one week—today through Friday, August 1, 2014.  To access this introductory peek into The Zone, go to and use the following case-sensitive user name and password:  UN:  IntrotoZone / PW:  FreeTrial.  Like what you see?  Then join the Center for Long-Term Care Reform here.  Or contact Damon at 206-283-7036 or  ***

The LTC Almanac is divided into 11 sections: 

Aging Demographics 
Unfunded Liabilities--Social Security, Medicare, and Budgets 
Long-Term Care 
Long-Term Care Financing 
Long-Term Care Insurance 
Reverse Mortgages 
Long-Term Care Providers 
Medicaid Planning   

Each section is divided into sub-sections and under each sub-section we provide a list by date of the most important reports and articles published on the topic, usually with a few highlights and sometimes with analysis.

The Almanac of Long-Term Care is a great way to find statistics you need quickly or to get current on topics you need to know the latest information about.

The Zone and the LTC Almanac are for Center for Long-Term Care Reform members only, except during the current free trial offer.  Join the Center here:  Call or email Damon at 206-283-7036 or  He can give you a user name and password to open up The Zone even before your annual dues payment arrives.  Individual annual memberships are $150.  Premium memberships with access to our “Clipping Service” start at $250.  Premium Elite and “Regional Representative” membership (if you qualify professionally) are $500.  Corporate memberships with many extra benefits start at $1,000.  See our "Membership Levels and Benefits" schedule here.

Caveat:  With time, some hyperlinks go bad.  In a huge document like the "LTC Almanac," we can't keep all the links current all the time.  If you find a bad link, but want to get to the material, contact us.  We often have an electronic copy of the document and we can usually find a current live link.  We'll also fix the link in the LTC Almanac so it will be current again for others.

Suggestion:  Read through the following update to stay current on new resource materials.  Then browse the full LTC Almanac at your leisure.  When you need a quick fact or the latest research on a particular topic, you'll know right where to go.  Enjoy.


Chapter 1:  Aging Demographics

General Stats

65+ in the United States, 2010 URL

65+ in the United States: 2010
Special Studies
Current Population Reports
By Loraine A. West, Samantha Cole, Daniel Goodkind, and Wan He
Issued June 2014

“The ‘65+ in the United States: 2010’ report expands on information related to long-term care and nursing homes compared to older reports. The report investigates a wide variety of topics including longevity, health, socio-economic characteristics, size and growth, and geographic distribution of the 65-and-older population.  …  To access the full report, click here.”

LTC Comment:  The big decline in nursing home population reflects the move by public (Medicaid) and private (LTCI and spend down) payers to fund custodial long-term care in homes and assisted living facilities rather than skilled nursing facilities.


Census Bureau on Aging 0514 URL: 

“An Aging Nation: The Older Population in the United States:  Population Estimates and Projections Current Population Reports Issued May 2014 P25-1140

"That the U.S. population is aging rapidly is no mystery, but that masks an important fact: America will remain a lot younger than many countries in the developed world.  Roughly 1 in 5 Americans (about 21%) will be 65 years old and up by 2050, compared with just 13% in 2010 and less than 10% in 1970, according to a new U.S. Census Bureau report released Tuesday."
Brookings on the Wealthy Poor 0314 URL:


“The Wealthy Hand-to-Mouth,” Greg Kaplan, Princeton University, NBER, and IFS Giovanni L. Violante, New York University, CEPR, NBER, and IFS Justin Weidner, Princeton University

3/21/14 LTC Clipping:

“A new paper by economists Greg Kaplan and Justin Weidner of Princeton University, and Giovanni Violante of New York University, finds that about 70 million Americans may live in families they describe as ‘wealthy hand-to-mouth’ households. These are families that own assets such as homes, cars, retirement plans and even boats, yet still spend virtually every dollar of their regular income because it’s necessary to pay all the bills they’ve racked up.”

LTC Comment:  Two points:  (1) this research shows why Medicaid’s home equity exemption of up to $814, 000 is crazy and (2) imagine the potential for funding long-term care insurance through a carve out of home equity which would protect the entire estate including the residual home equity.


Chapter 3:  Unfunded Liabilities:  Social Security, Medicare, Pensions and Budgets

CBO on Unfunded Liabilities

The 2014 Long-Term Budget Outlook 0714 URL:

LTC Clipping, 7/16/14

CBO: Medicare spending growth will slow down over the next 25 years, despite pressures from aging population - McKnight's Long Term Care News


“Federal spending on Social Security and the major healthcare programs is set to ‘rise sharply’ and account for 14% of gross domestic product by 2039, according to the CBO's annual budget outlook. Yet, the CBO projects Medicare and Medicaid spending over this time period will be $250 billion less than the agency projected in 2010.”

LTC Comment:  This news of a slight drop in expected government health care spending was all over the media yesterday.  Take it with a grain of . . . actually a shaker full . . . of salt.  Here’s the bigger picture from the same CBO report, “The 2014 Long-Term Budget Outlook”:

“Between 2009 and 2012, the federal government recorded the largest budget deficits relative to the size of the economy since 1946, causing its debt to soar. The total amount of federal debt held by the public is now equivalent to about 74 percent of the economy's annual output, or gross domestic product (GDP)-a higher percentage than at any point in U.S. history except a brief period around World War II and almost twice the percentage at the end of 2008.”


Unfunded Liability Estimates

Gokhale on Debt 0414 URL:  

The Government Debt Iceberg by Jagadeesh Gokhale

“Nobody who has even a passing acquaintance with economics could fail to realize that Western governments are highly indebted. Current generations have been consuming at the expense of future generations. However, just how indebted are we? The government measures how much it has borrowed to meet past spending commitments, but it does not measure how much money it needs to meet all the future pensions and healthcare promises it has made to tomorrow's older generations. Furthermore, no funds have been set aside to provide for these costs.  In The Government Debt Iceberg, Jagadeesh Gokhale reveals the extent to which western governments are keeping taxpayers in the dark about true levels of debt by hiding the magnitude of future spending commitments that cannot be met by future tax receipts.”


Chapter 4:  Long-Term Care


The Alliance For Health Reform: Covering Health Issues: A Sourcebook for Journalists Fall 2013 URL:

LTC Clipping, 3/25/14

 “The Sourcebook, produced with the support of the Robert Wood Johnson Foundation, has the latest information and data on pressing health care topics. It also includes the names and contact details for top experts in each subject area, along with a comprehensive glossary of health care policy terms.”

LTC Comment:  This recently updated “Sourcebook” slants toward public financing and away from market-based solutions but it is a useful resource.


“Long-Term Care Services in the United States: 2013 Overview” by Lauren Harris-Kojetin, Ph.D. Manisha Sengupta, Ph.D. Eunice Park-Lee, Ph.D. Roberto Valverde, M.P.H., December 13, 2013

CDC and NCHS on LTC Services 2013 1213 URL:

“First-ever CDC report: Nursing homes provide most long-term care nationwide, alternative settings gain ground in the West. Nursing homes still account for the vast majority of long-term care services available in the United States despite policies meant to encourage home- and community-based care, according to a new government report. The first-ever ‘National Study of Long-Term Care Providers’ includes data on the capacity and operational characteristics of providers, and information about the people cared for in these settings.”


Chapter 6:  Long-Term Care Financing


BPC LTC White Paper 0414 URL:  

“America's Long-Term Care Crisis: Challenges in Financing and Delivery”

“In December 2013, the Bipartisan Policy Center (BPC) launched a Long-Term Care Initiative under the leadership of the BPC Health Project leaders, former U.S. Senate Majority Leaders Tom Daschle (D-SD) and Bill Frist (R-TN), as well as former Congressional Budget Office Director Alice Rivlin and former Wisconsin Governor and Secretary of the U.S. Department of Health and Human Services Tommy Thompson. The Long-Term Care Initiative will propose a series of bipartisan policy options in late 2014 to assist in the effort to build consensus on how to finance and deliver long-term care-referred to in this paper as longterm services and supports (LTSS)-at a time of political discord and fiscal constraints. The initiative seeks to raise awareness about the importance of the issue, bringing it to the attention of the public, as well as to policymakers, and making a strong case for action. This paper sets the stage for BPC's recommendations by identifying the major challenges and key questions in the financing and delivery of LTSS for both seniors and individuals under age 65.”


Chapter 9:  Long-Term Care Providers

Medicaid Reimbursement

Nursing home shortfall report 2012 URL:

LTC Clipping, July 17, 2014:

5 states where Medicaid pounds nursing homes | LifeHealthPro

"LTCI issuers and producers have always emphasized the advantages that come with using carefully regulated private insurance, rather than a government program meant for the poor, and the advantages may be growing. . . .  Of the 39 states Eljay tracked in 2012, Michigan and North Dakota were the only ones in which the average Medicaid nursing home reimbursement rate exceeded the average allowable charges.  The biggest recorded shortfall between the average reimbursement rate and the average cost of care was in New Hampshire. In 2012, nursing homes there lost $57 per day – 24 percent of the average cost -- per Medicaid patient. In 2006, Arkansas was the only state in the annual funding table in which the average Medicaid nursing home patient generated an operating profit. A nursing home there could earn $1.24 per day for caring for a Medicaid patient. The biggest average shortfall -- $28.16, or 22 percent of the average cost – was in Illinois."  

The United States Average rate paid: $178.68.
Average allowed costs: $201.02.
Average difference: -$22.34.
Difference as a percentage of average allowed costs: -11%.
Percentage of patients with Medicaid: 63%.
Percentage of patients using private sources of funds: 22%.

LTC Comment:  You’ve seen us write often that Medicaid pays nursing homes less than the cost of providing the care and that the few remaining private payers in nursing homes (including those with LTCI) are compelled to pay half again as much as Medicaid to make up the difference.  This article is about the latest version of the annual report sponsored by the American Health Care Association that provides the evidence for these facts.  Check out the full report here.  Of the five states with the biggest Medicaid reimbursement shortfalls, we’ve done major reports on four:  New York, New Jersey, South Dakota and Wisconsin.  Those reports are here.


Chapter 10:  Medicaid

Medicaid is the 800-pound gorilla of LTC

Economics of Medicaid book 0414 URL:

The Economics of Medicaid: Assessing the Costs and Consequences,
Joseph Antos, Charles Blahous, Darcy Nikol Bryan , James C. Capretta, Robert Graboyes, Jason J. Fichtner, June O'Neill , Nina Owcharenko , Thomas P. Miller | edited by Jason J. Fichtner | Apr 08, 2014

Copy of book here:

“Medicaid, originally considered an afterthought to Medicare, is today the largest health insurance provider in the United States. Under the Affordable Care Act, the Congressional Budget Office projects Medicaid enrollment to increase nearly 30 percent by 2024, and federal spending on the program to double over the next decade. For the states, Medicaid is already the largest single budget item, and its rapid growth threatens to further crowd out other spending priorities.

“In this collection of essays, nine experts discuss the escalating costs and consequences of a program that provides second-class health care at first-class costs. The authors begin with an explanation of Medicaid's complex federal-state funding structure. Next, they examine how the system's conflicting incentives discourage both cost savings and efficient care.

“The final chapters address the pros and cons of the most mainstream Medicaid reform proposals and offer alternative solutions. This book offers a timely assessment of how Medicaid works, its most problematic components, and how-or if-its current structure can be adequately reformed to provide quality care, at sustainable costs, for those in need.”


Medicaid Financing

GAO on Medicaid payment variations 0614 URL:

LTC Clipping, July 17, 2014

“In fiscal year 2008, states recorded significantly varied amounts in Medicaid spending, according to a new Government Accountability Office analysis, Modern Healthcare reports. . . .

“The GAO analysis also found that:

  • California spent about $3,800 per beneficiary;
  • Rhode Island spent $11,700 per beneficiary;
  • Alabama spent an average of $9,000 for each beneficiary with a disability; and
  • New York spent an average of $32,000 for each beneficiary with a disability.”

LTC Comment:  Beneficiary is the wrong term to describe a Medicaid recipient.  Medicare is social insurance into which everyone pays and is therefore entitled to benefits, hence deserving the term “beneficiary.”  Medicaid is welfare.  People who receive Medicaid are public assistance “recipients.”

GAO on Medicaid Demographics and Usage 0214 URL:


“In fiscal year 2009, states spent nearly a third (31.6 percent) of all Medicaid expenditures on the most expensive Medicaid-only beneficiaries, who were 4.3 percent of total Medicaid beneficiaries. States spent another third (33.1 percent) on all other Medicaid-only beneficiaries, who represented 81.2 percent of total Medicaid beneficiaries. Among dual eligible beneficiaries, a similar pattern existed, with a small proportion of the population accounting for a disproportionate share of expenditures. . . . 

“Certain characteristics significantly increased the probability of being a high-expenditure Medicaid-only beneficiary. Specifically, the results of GAO’s analyses indicate that the probability of being a high-expenditure Medicaid-only beneficiary was:

• 24.4 percent for those residing in a long-term care facility,
• 20.8 percent for those with human immunodeficiency virus/acquired immunodeficiency syndrome,
• 18.3 percent for those with disabilities, and
• 13.3 percent for new mothers or infants.”

Chapter 11:  Medicaid Planning


GAO on Medicaid LTC Eligibility 0514 URL:

Medicaid: Financial Characteristics of Approved Applicants and Methods Used to Reduce Assets to Qualify for Nursing Home Coverage GAO-14-473: Published: May 22, 2014. Publicly Released: Jun 23, 2014. 

Read a summary and find a link to the full report here.

For our analysis and critique, see LTC Bullet:  GAO Punts on Medicaid Planning, Thursday, July 3, 2014.

LTC Comment:  Another GAO report underplays dramatic findings about the role, methods and extent of Medicaid planning and loose LTC eligibility rules.