LTC Bullet: Long-Term Care: The Solution (The Serial, Part 4)

Friday, December 1, 2023

Seattle—

LTC Comment: Today we offer easy access to a must-read new study by Center president Steve Moses, after the ***news.***

*** TODAY'S LTC BULLET is sponsored by Claude Thau with BackNine Insurance. Back9 gives you a free personalized website at no cost. Your clients (& family & friends) can, with as little or as much of your involvement as you or they want, buy life insurance and LTCi, and schedule parameds and upload their medical records to speed the process. We quote stand-alone LTCi, linked-benefit and life with a LTC rider side-by-side and provide a sales track with video support. 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 discuss how he might help you. ***

*** 11/30/2023, “Government must encourage personal responsibility, prohibit easy access to Medicaid,” by Steve Moses and Brian Blase, Washington Times

Quote: “Well-intentioned government policy tried to help people but ended up trapping generations in nursing homes on welfare. The government must now solve the problem it created by encouraging personal responsibility and prohibiting easy access to Medicaid while preserving wealth. This will naturally lead our nation’s consumers and providers to solve the LTC system challenges.”

LTC Comment: America’s LTC financing crisis is self-imposed by counterproductive public policies. To understand the problems and the solution, read “Long-Term Care: The Problem” and “Long-Term Care: The Solution.”

*** 11/27/2023, “A Long-Term Solution To America's Long-Term Care Crisis,” by Sally Pipes, Forbes

Quote: “Indeed, Medicaid has become such a major source of long-term care coverage that middle-income and even some wealthy Americans rely on the program to support them in their twilight years. … It is precisely this perverse incentive that Stephen A. Moses outlined in his 2022 Paragon Health Institute paper ‘Long-Term Care: The Problem.’ Moses, one of the nation's leading experts in long-term care, determined that access to Medicaid and other publicly-funded safety nets ‘discourages responsible [long-term care] planning when people are still young, healthy, and affluent enough to save, invest, or insure for the risk.’ Rather than continue down the same path, Moses urged policymakers to consider free-market solutions to the ‘problems caused by well-intentioned but ultimately damaging government’ policies. In a paper released last month—‘Long-Term Care: The Solution’—Moses offers some suggestions on how to do just that.”

LTC Comment: We thank Sally Pipes, president and chief executive officer of the Pacific Research Institute, for this clear and compelling review of “Long-Term Care: The Problem” and “Long-Term Care: The Solution.” Click through for the rest of her thought-provoking article. ***

*** 10/19/2023, “Medicaid should only be ‘safety net’ for LTC needs, expert says,” by Kathleen Steele Gaivin, McKnight’s Senior Living.

Quote: “‘Medicaid [long-term care] should be restored as a safety net for indigent elderly people,’ but ‘lawmakers should eliminate the ability to access publicly funded LTC while preserving wealth,’ Stephen Moses, president of the Center for Long-Term Care Reform, writes in a new paper, ‘Long-Term Care: The Solution.’ … The new paper is a follow-up to Moses’ “Long-Term Care: The Problem,” which was published a year ago by the Paragon Institute.”

LTC Comment: This article is a reasonable interpretation of what my paper says, but I urge readers to see for themselves, because the topic is complicated and full of nuances. I’m always eager to receive comments or criticism at smoses@centerltc.com. ***

*** APPEAL: The Center for Long-Term Care Reform, in partnership with the Paragon Health Institute, is embarking on a campaign to improve LTC services and financing. In “Long-Term Care: The Problem,” we explained what’s wrong and why. In “Long-Term Care: The Solution,” we discard the failed policies of the past and propose a radical new approach based on engaging vast sources of private wealth currently diverted from LTC funding. We will reach out to the media, brief federal and state policy and law makers, speak at conferences, and write for publication, all toward the end of achieving the policy goals in “Long-Term Care: The Solution.” Will you help us in this effort? Join the Center or contribute online here. Check out the Center’s “Membership Levels and Benefits” schedule here. Most corporate memberships include a briefing by Center president and “LTC Solution” author Stephen Moses. Call or write for more information: 206-283-7036; damon@centerltc.com; smoses@centerltc.com. LTC policy has floundered for too long. Let’s get this done! ***

 

LTC BULLET: LONG-TERM CARE: THE SOLUTION (THE SERIAL, PART 4)

LTC Comment: The Paragon Health Institute published “Long-Term Care: The Solution” on October 3. This new report is long and complicated, but important. So LTC Bullets is delivering it to you in bite-sized pieces over several weeks. Published so far: Long-Term Care: The Solution (The Serial), October 20, 2023, Long-Term Care: The Solution (The Serial, Part 2), November 3, 2023 and Long-Term Care: The Solution (The Serial, Part 3). Today, read “Poverty Reconceptualized,” “Managing the Back End,” “Why Not Social Insurance Instead?,” “Summary and Conclusion” and the “Appendix: Exactly How Much Wealth Do People Have and Why Aren’t They Using More of It for LTC?” 

Excerpts from “Long-Term Care: The Solution
by
Stephen A. Moses
President, Center for Long-Term Care Reform

[Box Insert] Poverty Reconceptualized:

Clearly there is enough wealth in the American economy to fund quality LTC for all Americans if it is mobilized with better incentives than prevail now. In fact, poverty, properly measured, is already uncommon in the United States.[67] A 2018 Cato Institute study reports, “Improved estimates of poverty show that only about 2 percent of today’s population lives in poverty, well below the 11 percent to 15 percent that has been reported during the past five decades.”[68] How can that be? “By design, the official estimates of income inequality and poverty omit significant government transfer payments to low-income households; they also ignore taxes paid by households.”[69] What is the bottom line? “The net effect is that pretax data overstate the true income of upper-income households by as much as 50 percent, and missing transfers understate the true income of lower-income households by a factor of two or more.”[70] The rich are poorer and the poor, richer than we thought. “More than 50 years after the United States declared the War on Poverty, poverty is almost entirely gone.… Public policy debate should begin with the realization that only about 2 percent of the population—not 13.5 percent—live in poverty.”[71]

The official poverty level calculated by the government does not involve the level of total destitution some may associate with it. Consider a poor household’s consumption a decade ago according to a Heritage Foundation analysis:

The typical poor household, as defined by the government, has a car and air conditioning, two color televisions, cable or satellite TV, a DVD player, and a VCR. By its own report, the typical poor family was not hungry, was able to obtain medical care when needed. The typical average poor American has more living space in his home than the average (non-poor) European has.[72]

Worries about income inequality are also misplaced. “By not counting two-thirds of all transfer payments as income to the recipients of the transfers and not counting taxes paid as income lost to taxpayers, government statistics dramatically overstate income inequality.… The facts reveal a very different and better America than the one currently described in debates across much of the political spectrum.”[73] Phil Gramm and John Early concluded: “By eroding self-reliance, worker pride and labor-force participation, government-generated income equality undermines the very foundations of American prosperity.”[74]

Applying this corrected understanding of poverty and “inequality” to the challenge of financing LTC suggests, as do other facts referenced above, that America has more sources of wealth to work with than previously contemplated by most experts. Mustered and employed more sensibly, these resources would suffice to ensure access to quality LTC for all Americans.

[End box insert]

Managing the Back End

This proposed approach of withdrawing Medicaid asset protection in the future and encouraging private LTC planning in the present will not cover everyone who may need LTC later. Some will be unable to fund any of the options that will become available. Others will decide not to plan. But most people, faced with an immediate requirement to confront LTC risk and cost, will likely take steps to prepare. Still, 14.7 percent of people turning 65 will incur LTC expenses of $250,000 or more, nearly half of which Medicaid already pays.[75] Much relieved of the need to cover most of the cost of LTC, Medicaid could continue as the payer of last resort for these people.

With the techniques used to qualify for Medicaid while preserving wealth eliminated in the future for people currently under age 55, over time Medicaid LTC benefits will no longer be available to people while also allowing them to retain income and resources. Far fewer people will be dependent on Medicaid. At that point the program should pay full private market rates so remaining recipients can receive high-quality home care, assisted living, or nursing home care as needed. The existing two-tier LTC service delivery system—in which Medicaid recipients receive lower cost, less desirable care compared to market-rate private payers—should largely end. Resources accumulated in private hands through insurance, targeted savings or from reverse mortgages or liens, will suffice to fund the vast majority of all LTC for most people. In fact, even before those measures are employed, most older adults could already finance substantial LTC if required to use resources they already own for that purpose.[76]

With most LTC provided within the private market at market payment rates, LTC providers would prosper instead of being underpaid by Medicaid as they now are. Private market competition would ensure adequate compensation for LTC nursing and support staff, which would eliminate their shortage. In addition, fewer people would need to provide direct care themselves for friends and family. They could instead provide love and support without having to provide bathing assistance or change adult diapers. Entrepreneurs would compete to find newer and better service delivery methods. The financial burden on government and taxpayers would lessen substantially. Impoverishment due to LTC, to whatever heretofore unsubstantiated level it has existed,[77] would mostly disappear.

Why Not Social Insurance Instead?

Why not simply require by government fiat that everyone must pay a tax so that all can receive a LTC benefit when it is needed? That is the sirens’ song of social insurance.

Why is social insurance so appealing to intellectuals and politicians despite their inability to get such plans approved by voters? By compelling citizens to participate in the scheme, social insurance avoids the biggest problem of voluntary private insurance. People are not forced to purchase private LTC insurance, so many do not, leaving too many unprotected. By forcing everyone to pay for social insurance, government ensures that the substantial financial risk of LTC is spread across the whole population. Social insurance avoids adverse selection, the problem of only those most likely to use the insured benefit purchasing private insurance for it, resulting in a solvency death spiral. Despite these apparent benefits, proposals for compulsory LTC social insurance have never achieved the approval of voters and taxpayers. Why?

The compulsion and universality of social insurance also have vital downsides, including loss of freedom and some perverse incentives. Because social insurance spreads (but does not price) risk, it rewards irresponsibility and punishes responsible behavior. Private insurance, on the other hand, spreads but also prices risk. People pay more for private life insurance if they smoke, so it discourages smoking and rewards healthier behavior. Social insurance does the opposite. It charges everyone the same regardless of how much risk they bring into the risk pool, thus rewarding high-risk people and behaviors while punishing low-risk people and behaviors. Private insurance rewards personal responsibility and self-reliance, whereas social insurance rewards and thus encourages government dependency.

The moral precept of social insurance is “from each according to his ability, to each according to his need,” the fundamental principle of socialism. Across a society the incentives and disincentives of social insurance undermine personal responsibility, discourage individual effort, and lead to excessive reliance on others for support, including government authorities exercising their monopoly of the legitimate use of force. Social insurance always and everywhere tends toward collective mediocrity and individual failure. In light of the short-term solvency denouement of Social Security and Medicare, we should view new social insurance plans with increasing skepticism.

Summary and Conclusion

Albert Einstein said, “We can’t solve problems by using the same kind of thinking we used when we created them.”[78] The kind of thinking that created LTC’s problems is that markets cannot provide the services people need without massive government regulation and financing. No other way of thinking about the problem has been seriously considered. But recent research suggests how to reconceptualize the quandary policymakers face so that LTC is not such a titanic crisis and may be fixable with a market-based solution.

Eliminating the means by which people have ignored LTC planning early in life while preserving wealth and qualifying for Medicaid later can encourage consumers to prepare early and responsibly for future LTC risk. Showing them ways to set aside wealth that they already possess or will accumulate over time can enable them to manage the LTC risk while fulfilling other responsibilities such as raising a family, car and house payments, retirement, and education savings.

LTC need not be the overwhelming challenge that pushes analysts toward “easy” solutions involving economically harmful payroll taxes, government compulsion, and public entitlement programs. Properly conceived and with the right financial tools and incentives available, LTC can be fully financed and vastly improved without undue pressure on families, consumers, or taxpayers.

Appendix: Exactly How Much Wealth Do People Have and Why Aren’t They Using More of It for LTC?

The following table is condensed from a more detailed version published by the National Council on Aging and the LTSS Center in a February 2023 report. It displays the wealth of older adult households by quintile through 80 percent and then by decile to 100 percent. The report states that “the bottom 20%, approximately 11 million households, have no assets. This group has a 2018 median income of $16,989 and would be unable to rely on personal finances to pay for LTSS, especially with rising costs of care.”[79] Clearly, this is an economic group for which Medicaid LTC benefits are intended to provide a safety net.

Older Adult Households Divided into Quintiles or Deciles of Total Net Wealth (2018)                                                             

Quintiles

0-20%

21-40%

41-60%

61-80%

81-90%

91-100%

Total household income (median)

$16,989

$27,240

$40,000

$52,229

$71,135

$109,092

Net value [home equity] of primary residence (median)

0

$45,000

$115,000

$220,000

$300,000

$400,000

Household value of financial assets (non-housing, median)

0

$2,000

$16,300

$130,000

$480,000

$1,331,254

The report continues: “The next three quintiles (21–40%, 41–60%, and 61–80%) of older adults saw modest increases in their financial assets between 2016 and 2018, but these individuals would still be unable to afford more than two years of nursing home care in a semi-private room or four years in an assisted living community if their median income and household value of financial assets were added together. Despite adults’ preference to age in place, 60% of adults would be unable to afford two years of in-home long-term services and supports.[80]

That conclusion is striking. If 60 percent of middle-class aging Americans cannot afford two years of in-home LTSS, then it follows that 40 percent can. If so, that would cover the average LTC risk and cost for most of them: “[O]ver half of adults 65 and older will need LTSS for less than two years … .”[81]

But are people actually spending down their wealth for LTC? How much of their income, “household value,” and other financial assets do people actually use to fund their own LTC? Conventional wisdom holds that high LTC costs force wide swaths of American elders into impoverishment, leaving them dependent eventually on Medicaid. Is that what happens? Do middle-income people have any other choice? If faced with high LTC costs, would people in the fourth wealth quintile (61-80 percent) need to spend down their wealth before qualifying for Medicaid-financed LTC?

Their median total household income is $52,229. The rule of thumb for income is that anything below the cost of a nursing home is not disqualifying. That is because private health and LTC expenditures are usually deducted from income before comparing the balance to Medicaid’s very low allowable limit.[82] A well spouse would keep any income in his/her sole name plus a “monthly maintenance needs allowance” of up to $2,465 or $29,580 per year (as of 2023) from the recipient’s income. Any remaining income in the Medicaid recipient’s name would go to offset the program’s cost for his/her care, but if there is an estate recovery later, the recipient would be liable only for what Medicaid spent for his/her care, which is much less than what the private pay cost would have been.

Thus, while some private income goes for care, this out-of-pocket cost—mostly Social Security income (explained below)—merely reduces Medicaid’s share of the extremely low reimbursement, often less than the cost of care, that the LTC provider receives. Although the recipient is paying out of pocket, he/she is not commanding the better access and higher quality care associated with paying privately. He/she is trapped in the lower Medicaid level of America’s two-tier LTC system.

What about assets? Must they be spent down before getting Medicaid? The “net value of primary residence” (i.e. home equity) of people in the fourth wealth quintile is $220,000. Does that amount interfere with Medicaid LTC eligibility compelling asset spend down? No. Medicaid exempts a minimum of $688,000 of home equity and up to $1,033,000 in some states. Even the richest people would qualify for Medicaid based on their home equity of $400,000.

But, as is widely known, Medicaid allows applicants/recipients to hold no more than $2,000 in “countable” assets while qualifying for or receiving Medicaid LTC benefits. The fourth quintile’s “household value of financial assets (non-housing, median)” is $130,000. But that is just a starting point. If there is a spouse, Medicaid computes the couple’s jointly owned assets and sets aside half—not to exceed $148,620 but never less than $29,724 (as of 2023)—for the “community spouse.” Then Medicaid takes out the non-countable assets people own, such as “pre-paid burial and funeral expenses, an automobile, term life insurance, life insurance policies with a combined cash value limited to $1,500, household furnishings/appliances, and personal items, such as clothing and engagement/wedding rings.”[83] Very few people in the fourth quintile of wealth will have much savings left after these deductions, but whatever remains can easily be converted to non-countable status by investing more money in the home or purchasing, in unlimited amounts, any of the other exempt items just listed.

When they confront high LTC costs, do middle-class people ignore these generous Medicaid financial eligibility limits and pay out of pocket? Do they voluntarily plunge themselves into real impoverishment from a sense of personal responsibility or shame at depending on public assistance? Some do. More used to. But nowadays information on how to qualify for Medicaid without spending down for care is universally available in magazine articles and self-help books, in legal treatises and on the internet. Google “Medicaid planning in [any state]” to find long lists of attorneys who specialize in qualifying clients for Medicaid while preserving their wealth. Even state Medicaid eligibility workers routinely explain to middle-class applicants how to speed up or entirely eliminate their “spend down” process by purchasing exempt assets. Workers report that people think of Medicaid (public assistance) as though it were an entitlement like Medicare.[84] They ask, as Jane Bryant Quinn did in a 1989 Newsweek column, “Do Only the Suckers Pay?”[85] So, no, ignoring easy access to Medicaid LTC benefits and paying out of pocket is the exception, not the rule.

But what about the conventional wisdom that people all across America must be, and actually are, spending down to impoverishment before obtaining Medicaid? If that is true, it should show up in the data. But it does not. The percentage of nursing home costs paid by Medicaid and Medicare has nearly doubled over the past half-century from 26.8 percent in 1970 to 52.3 percent in 2021, while out-of-pocket costs have shrunk by half in the same period from 49.2 percent in 1970 to 24.5 percent in 2021.[86] Nursing home private-pay revenue has plummeted to 7 percent.[87]

The situation with home health care is very similar. America spent $125.2 billion on home health care in 2021, of which Medicare (37.2 percent) and Medicaid (34.2 percent) paid 71.4 percent. Private health insurance (not LTC insurance) paid 12.7 percent. Only 10.3 percent of home health care costs were paid out of pocket. The remainder came from several small public and private financing sources.[88] Maybe people are spending down for assisted living. Some surely do, but “Almost 1 in 5 [assisted living] residents relies on Medicaid to pay for daily services (18%),” “61% of [assisted living facilities] are Medicaid certified,” and only “a small minority of state Medicaid programs do not cover services in assisted living.”[89] Assisted living began exclusively as a private-pay option, but that is changing rapidly. Still, to count spend down for assisted living as an out-of-pocket LTC expenditure is dubious, because a large portion of the fee for assisted living covers room and board, not LTC.

So how can it still be that “Family out-of-pocket costs are also substantial, averaging $44,800 and accounting for 37% of the total” LTSS expenses, averaging $120,900 per person?[90] The answer is another anomaly of Medicaid LTC financing policy: People receiving Medicaid LTC benefits are required to contribute all but a small portion of their income to offset Medicaid’s cost for their care. While this income “spend-through” is rarely considered, research from three decades ago documented that it is substantial, roughly half of what is reported as out-of-pocket costs.[91] This matters because the spend-through income—mostly Social Security benefits, although correctly considered to be a private out-of-pocket expenditure for Medicaid LTC—is not asset spend down and does not come from people’s savings or home equity. Relatively little of what is reported as personal out-of-pocket LTC expenditures comes from savings or home equity expended for nursing home or home health care. Much of it is Social Security income that is vulnerable to that entitlement program’s potential insolvency and has been contributed by people already on Medicaid, some of whom are receiving Medicaid while residing in assisted living facilities or continuing care retirement communities (CCRCs).[92] Removing private payments for assisted living and CCRCs, much of which cover room and board costs and not LTC, leaves much less reported out-of-pocket LTC costs remaining that could actually constitute consumption of life savings or real property assets.

Finally, analysts often refer to the University of Michigan Health and Retirement Study and its auxiliary, the Asset and Health Dynamics among the Oldest Old study for evidence to support their presumption that people are spending down assets to qualify for Medicaid LTC benefits. Research does show that people tend to decumulate assets rapidly at older ages, and many do qualify for Medicaid thereafter. But there is nothing in the data to link decumulation of wealth with spend down on health or LTC costs. Those sources show only that transitions to Medicaid eligibility occur. Such transitions may as likely be the result of Medicaid planning (i.e., artificial self-impoverishment) conducted many years before in anticipation of the future need for LTC.

The widespread belief that high LTC costs impoverish large numbers of aging Americans is unsupported by the evidence. Medicaid financial LTC eligibility rules do not exclude people up to and through the fourth quintile of wealth. Ample evidence suggests that the public is aware of methods to qualify easily for Medicaid LTC benefits or quickly learn how when expensive care costs arise. Private-pay revenue for LTC providers, including home health agencies and skilled nursing facilities, is low and falling. Private pay for assisted living and CCRCs—much of which does not go for LTC but rather for room and board—should not be bunched in with spending for home health and skilled nursing. In the absence of evidence of high out-of-pocket spend down for LTC, analysts should reassess what is actually happening and how to address reform.

In summary, middle-class Americans have enough wealth to fund their average expected LTC costs, and this wealth is largely exempt from Medicaid spend down rules. Information on how to access Medicaid LTC benefits without spending down is widely available, and there is no evidence of widespread LTC spend down resulting in impoverishment. So, one can conclude that changing Medicaid eligibility policy to remove the option to ignore LTC, shelter personal wealth, and rely on public benefits when LTC becomes necessary should free up enormous resources of private wealth to support LTC financing.

 


[67] Phil Gramm, Robert Ekelund, and John Early, The Myth of American Inequality: How Government Biases Policy Debate (Lanham, MD: Rowman and Littlefield, 2022).

[68] John F. Early, “Reassessing the Facts about Inequality, Poverty, and Redistribution,” Cato Institute, April 24, 2018, p. 1, https://www.cato.org/policy-analysis/reassessing-facts-about-inequality-poverty-redistribution.

[69] Early, “Reassessing the Facts,” p. 2.

[70] Early, “Reassessing the Facts,” p. 4.

[71] Early, “Reassessing the Facts,” 21.

[72] Rachel Sheffield and Robert Rector, “Air Conditioning, Cable TV, and an Xbox: What Is Poverty in the United States Today?,” Heritage Foundation, July 19, 2011, https://www.heritage.org/poverty-and-inequality/report/air-conditioning-cable-tv-and-xbox-what-poverty-the-united-states.

[73] John F. Early, “The Myth of American Income Inequality,” Cato Institute, September 20, 2022, https://www.cato.org/study/myth-american-income-inequality.

[75] “About 15% of older adults can expect their total LTSS expenses from age 65 onward to amount to more than $250,000, whereas about 8% will have positive but low costs (less than $10,000). A smaller percentage (about 6%) will spend $250,000 or more out of pocket on LTSS. Fourteen percent will spend at least $100,000 out of pocket on LTSS after turning 65.” Johnson and Dey, “Long-Term Services and Supports for Older Americans,” p. 8.

[76] “Most older adults could finance a substantial amount of paid home care out of pocket. About three-quarters of non-Medicaid, community-dwelling adults ages sixty-five and older could cover at least two years of moderate amounts of paid home care—the median duration among recipients—with their available resources, and about two-thirds could fund that amount of care using only their income and financial assets.” Johnson and Wang, “The Financial Burden of Paid Home Care on Older Adults,” p. 999.

[77] LTC researchers often claim that spend down for high LTC costs plunge wide swaths of older Americans into impoverishment, leaving them dependent on Medicaid. That presumption has become conventional wisdom as well. But proof for this “fallacy of impoverishment” is never offered. Researchers claim data from the HRS and AHEAD surveys substantiate spend down. But those sources only document “transitions” to Medicaid. Such transitions could occur due to spend down. But they are as likely or more so to happen as a result of Medicaid planning, artificial self-impoverishment, conducted much earlier in anticipation of future LTC need. Certainly, spend down of assets on health or LTC expenses is not required to achieve Medicaid LTC financial eligibility as explained in Long-Term Care: The Problem and above.

[79] Rocki Basel et al., “The Continued Toll of Financial Insecurity in Retirement,” National Council on Aging and LTSS Center, February 2023, https://ncoa.org/article/addressing-the-nations-retirement-crisis-the-80-percent-financially-struggling. Cited 9/4/23.

[80] Basel et al., “The Continued Toll of Financial Insecurity in Retirement.” Emphasis in original.

[81] Basel et al., “The Continued Toll of Financial Insecurity in Retirement.”

[82] Most states (34) use the “medically needy” income eligibility method. They deduct private medical and LTC expenses from income before determining eligibility, enabling people to qualify despite having incomes well above categorical eligibility limits. Other states use an “income cap” method, allowing income up to 300 percent of the Supplemental Security Income monthly limit. People with much higher incomes can still qualify for Medicaid in income cap states by diverting any excess income to an income diversion trust, also known as a “Miller” or “Qualified Income Trust.” For an explanation of the medically needy and income cap pathways to Medicaid income eligibility, see American Council on Aging, “Income Spend Down,” updated December 14, 2022, https://www.medicaidplanningassistance.org/medicaid-spend-down/.

[83] American Council on Aging, “Spending Down Assets to Become Medicaid Eligible for Nursing Home/Long Term Care,” updated December 14, 2022, https://www.medicaidplanningassistance.org/medicaid-spend-down/.

[84] Many are quoted in Center for Long-Term Care Reform state-level reports accessible here: http://www.centerltc.com/reports.htm.

[85] Jane Bryant Quinn, “Do Only the Suckers Pay?,” Newsweek, December 18, 1989.

[86] Centers for Medicare and Medicaid Services (CMS), National Health Expenditure Data, Table 15, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical. To access Table 15, open and unzip NHE Tables (ZIP).

[87] National Investment Center, “Monthly Skilled Nursing Data Report,” February 2023, https://info.nicmapvision.com/nic-map-skilled-nursing-data-monthly-report.html.

[88] CMS, National Health Expenditure Data, Table 14. To access Table 14, open and unzip NHE Tables (ZIP).

[89] American Health Care Association and National Center for Assisted Living, “Facts and Figures,” https://www.ahcancal.org/Assisted-Living/Facts-and-Figures/Pages/default.aspx. Find these quotes under the source’s “Finance” tab.

[90] Basel et al., “The Continued Toll of Financial Insecurity in Retirement.”

[91] “An estimated 41 percent...of out-of- pocket spending for nursing home care was received as income by patients or their representatives from monthly social security benefits.” Helen C. Lazenby and Suzanne W. Letsch, “National Health Expenditures, 1989,” Health Care Financing Review 12, no. 2 (1990), p. 8, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4193104/. Later research confirmed that Social Security spend-through is almost half of nursing home out-of-pocket costs. Nelda McCall, ed., Who Will Pay for Long Term Care? Insights from the Partnership Programs (Chicago: Health Administration Press, 2001), p. 19.

[92] The Centers for Medicare and Medicaid Services changed the definition of National Health Expenditure Accounts categories in 2011, adding CCRCs to Nursing Care Facilities. This change had the effect of reducing Medicaid’s reported contribution to the cost of nursing home care and increasing the amount reported as “out of pocket” expenditures, because CCRCs, like assisted living facilities, are mostly private pay.