LTC Bullet: LTC Studies Share Flaws

Friday, September 16, 2022

Seattle—

LTC Comment: Three new LTC studies don’t ask “what went wrong?” before prescribing more of what caused LTC’s problems in the first place. We explain after the ***news.***

*** TODAY'S LTC BULLET is sponsored by Claude Thau with BackNine Insurance.  In addition to many unique services to advisors relative to individual, worksite and affinity LTCi (including his revolutionary “Range of Exposure” tool that protects FPs from risks most don’t recognize).  New service: your own free insurance website allowing clients to buy insurance with as little or as much of your involvement as you or they want.  Claude is the lead author of Milliman’s annual Broker World LTCi Survey & a past Chair of the Center for Long-Term Care Financing. Contact him at 913-707-8863 or claude@back9ins.com to kick his tires & discuss how he might help you. ***

*** ROMEO RAABE, LUTCF, LTCP is The Long-Term Care Guy of Wisconsin, a proactive advocate for better LTC financing policy, and a long-time Regional Representative of the Center for LTC Reform. Contact him at (920) 884-3030 or rraabe@thelongtermcareguy.com. He offers

this comment: 

“Are We Selling Appropriate LTCi?
by
Romeo Raabe

There are a multitude of different products sold to help pay for the cost of LTC. There are also many choices as to how much money is needed, for how long, with or without inflation, various deductibles, and choices of facility coverage, home care coverage or both. Everyone has an opinion on these options but the important part is for our clients to have sufficient cash flow to pay for the care they need - when they need it. That is the point, isn't it?

One type of comment I often hear is “This can turn $100,000 into $300,000 for LTC.” Sounds pretty good to many, but let’s ask how much the client can get out each month and is that enough along with other cash flow to pay the bills? If not, and they spend down to Medicaid, have we done any good other than earn a commission? If the plan, which the client understands, is just to have enough to cover some home care, then it’s fine. But if the client expects to be able to afford a nursing home, it’s not.

Something is not always better than nothing if it does not do what the client expects. First, do no harm. ***

 

LTC BULLET: LTC STUDIES SHARE FLAWS

LTC Comment: America has an abundance of dedicated, well-intentioned analysts who lament the state of long-term care and want to fix it. I could list (and have listed) dozens of studies these scholars conducted which share two fatal flaws. First, none of them ask—much less answer— what caused the long-term care system’s current dysfunctional state before recommending more government funding and regulation to fix it. Second, they all founder on the shoals of inadequate financing.

Add these three recently released studies to that list:

Study # One: “Improving Care for Older Adults: Convergence Dialogue on Reimagining Care for Older Adults Project Staff and Consultants: Final Report” tells us what’s wrong with long-term care and prescribes:

1.     “Establish a broad constellation of financially sound and adaptable care settings that reflect the desires and needs of older adults.

2.     “Ensure There Are Enough Caregivers

3.     “Finance the Future Care System”

Why are these measures necessary? What caused the problems they’re supposedly needed to resolve? Why is it government’s job to fix a broken system already dominated by government spending and regulation? Blank out.

Study # Two: “The National Imperative to Improve Nursing Home Quality: Honoring Our Commitment to Residents, Families, and Staff (2022)” devotes 600 pages to lamenting the sorry state of nursing home care in the USA …

“First, the way in which the United States finances, delivers, and regulates care in nursing home settings is ineffective, inefficient, fragmented, and unsustainable. …

“Second, immediate action to initiate fundamental change is necessary. …

“Third, federal and state governments, nursing homes, health care and social care providers, payers, regulators, researchers, and others need to make clear a shared commitment to the care of nursing home residents. …

“Fourth, extreme care needs to be taken to ensure that quality-improvement initiatives are implemented using strategies that do not exacerbate disparities in resource allocation, quality of care, or resident outcomes (including racial and ethnic disparities), which are all too common in nursing home settings.

“Fifth, high-quality research is needed to advance the quality of care in nursing homes.

“Sixth, the nursing home sector has suffered for many decades from both underinvestment in ensuring the quality of care and a lack of accountability for how resources are allocated. …

“Finally, key partners, such as the Centers for Medicare & Medicaid Services (CMS) and other federal agencies, may not currently have the full authority or resources to carry out the actions recommended.”

So, what’s the bottom line?

“Therefore, as a final overarching conclusion, the committee notes that all relevant federal agencies need to be granted the authority and resources from the U.S. Congress to implement the recommendations of this report.”

In other words, everything wrong with nursing home care in the United States is directly related to public financing and regulation, but the National Academies of Sciences, Engineering, and Medicine can think of nothing better to do about it than to pile on more of the same.

Study # Three: “Where Am I, Where Do I Go: The Missing Entry Point to Long-Term Care Solutions for Older Adults and Their Caregivers” explains how America’s LTC system leaves people in crisis floundering, under extreme financial pressure, lacking guidance, not knowing what to do, but having to do something fast. It paints a beautiful picture of an improved system that points everyone in need of long-term care to the best possible solution.

But here again: “Although this paper does not specifically recommend a funding model for the hubs, we recognize that funding will be a barrier to achieving our vision. Historically, policy options for long-term care have focused on creating a financing system to fund services, which is critically important for supporting families and funding a long-term care workforce. However, policy must also focus on the navigational needs of older adults and their families.”

In other words, the need is so great we just have to find a way to do this and pay for it. Can’t somebody do something?!

LTC Comment: The only way we’ll ever confront long-term care’s problems successfully and actually solve them is to begin by asking: what caused the problems in the first place? I’ve answered that question already in two reports—Medicaid_and_Long-Term_Care  and How to Fix Long-Term Care Financingwith two more forthcoming: “The Long-Term Care Problem” and “The Long-Term Care Solution.” Bottom line, government financing and regulation caused LTC’s problems. Medicaid paid for expensive LTC after care is needed resulting in a moral hazard that prevented most people from planning ahead for the LTC risk and left them dependent on public assistance when the need arose later. To solve LTC’s problems, Frontload LTC so most people save, invest, or insure for the risk and cost while they’re still young, healthy and affluent enough to do so and thus dramatically reduce the number of people who end up dependent on Medicaid. The free market will do the rest, directing creative entrepreneurial energy toward finding the best ways to meet consumers’ LTC preferences and needs.