long-term care partnership: protecting consumers and states from catastrophic expenditures state...
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Long-Term Care Partnership: Long-Term Care Partnership: Protecting Consumers and States Protecting Consumers and States from Catastrophic Expendituresfrom Catastrophic Expenditures
State Coverage Initiatives Winter MeetingFebruary 8, 2008
Chad ShearerProgram Officer, CHCS
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About CHCSAbout CHCS
Our Mission
To improve health care quality for low-income children and adults, people with chronic illnesses and disabilities, frail elders, and racially and ethnically diverse populations experiencing disparities in care.
Our Priorities Advancing Health Care Quality and Cost-Effectiveness Reducing Racial and Ethnic Disparities Integrating Care for People with Complex and Special Needs
Our National Reach48 states160+ health plans
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BackgroundBackground
• Aging boomers• High probability of
needing nursing home services
• High cost of long-term care services
• Medicaid:– Largest payer for
nursing home services– Long-term care is
substantial portion of Medicaid spending
National Spending on Nursing Home Care,By Source of Payment (2005)
Total = $122 Billion
Medicare, 15.7%
Medicaid, 43.9%
Other Private Funds, 3.7%
Other Public Funds, 2.7%
Private Health Insurance,
7.5%
Out of Pocket Payments,
26.5%
Source: Centers for Medicare & Medicaid Services (CMS), National Health Expenditures
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LTC Partnership History
•Robert Wood Johnson Foundation (Late 1980s)
– States and insurers collaborate on long-term care insurance product for those who might otherwise rely on Medicaid to finance LTC.
•Four states implement programs (Early 1990s)
– California, Indiana, New York, Connecticut
•Moratorium on new Partnership programs (1993)
– 4 original states allowed to continue
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Partnership Benefits
•Asset Protection – If Partnership policies do not sufficiently cover the cost of LTC, beneficiaries may qualify for Medicaid while retaining a level of assets that would otherwise preclude them from eligibility.
– Attract middle-income consumers who might not otherwise purchase LTC insurance.
•Medicaid budget protection – GAO reported mixed results but original states and growth suggest budget benefit.
– Only a small portion of policy holders exhaust their private benefits
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Partnership Resurgence
• Deficit Reduction Act (DRA) of 2005
– Eliminated moratorium on Partnerships
• Rules for new Partnerships
– Approved Medicaid State Plan Amendment (SPA)
– Consumer Protections – NAIC Model Act & Regulations
– Asset Protection – Dollar for dollar protection
– Inflation Protection – Depending on age of purchaser
• Original Partnership states deemed to have satisfied new requirements
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Partnership Expansion
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CHCS/RWJF Initiative
•Long Term Care Partnership Expansion
– Seed funding to 10 states developing partnership programs:
•Arkansas, Colorado, Georgia, Michigan, Minnesota, Ohio, Oklahoma, South Dakota, Texas, Virginia
•3 states operational, 3 with approved SPAs
– Technical Assistance
– Policy Briefs
– In-Person Meetings
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Partnership Issues
• States implementing or considering partnerships must consider:
– Inflation protection
– Agent Training
– Policy Exchange
– Reciprocity
– Reporting Requirements
– Medicaid Eligibility Determinations
– Cost Effectiveness
– Outreach
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Contact/Resources
CHCS – www.chcs.org – (609) 528-8400 Chad Shearer – [email protected] Joanie Rothstein – [email protected]
• Long Term Care Partnership Program Technical Assistance Website - http://www.dehpg.net/LTCPartnership/
• Centers for Medicare & Medicaid Services (CMS) - http://www.cms.hhs.gov/DeficitReductionAct/09_LTCPartnerships.asp
• National Association of Insurance Commissioners (NAIC) – www.naic.org
• Long Term Care Group, Inc. - http://www.ltcg.com
• Provider Groups Financing Reform Agenda - http://www.aqnhc.org/email/20080115_2.html