Paying For Long-Term Health Care

As part of an assessment on long-term health care issues in Connecticut presented to state legislators this week, the Center on Aging at the University of Connecticut has issued the state’s first comprehensive report on the topic in more than 20 years. The report highlights a problem that has been exacerbated by increased health care costs and the aging population: the indigent are prime consumers of long-term health care. This is not entirely because the poor tend to need more health care as they age; it also reflects the harsh reality that health care itself quickly exhausts the resources of persons of modest means and creates poverty.

This is a critical issue for the state, which already struggles to meet the demands on its Medicaid resources. The number of state residents who need long-term care is expected to rise from 188,000 this year to 240,000 in 2030. Most people would prefer to stay in their homes as long as they can with the help of in-home health care and various safety-net community services. It is both less traumatic than moving to the institutional setting of a long-term health care facility and cheaper. But elders with limited resources must rely on health care services available through Medicare or whatever private insurance they have, which typically limit coverage of long-term in-home services. With the steady rise in premium costs for long-term care insurance, more and more seniors will have fewer and fewer options to economic ruin and placement by Medicaid in a nursing home when they need long-term health care.

Currently, Connecticut allocates about a third of its Medicaid resources to home-based and community services that bring health assistance to people where they live. Oregon allocates more than double that amount, 70 percent of its Medicaid spending, on programs designed to keep the elderly out of expensive nursing homes. It is a policy that addresses human needs and saves money. And it is a model Connecticut should follow.

Last week, Julie Evans Starr, executive director of the Connecticut Commission on Aging, urged state legislators to develop a system that “respects people’s wishes and choices… in which a person’s location and services aren’t dictated by arbitrary restrictions or the funding stream.”

Reform will also be key to the future of Medicaid itself, which has become the nation’s primary payer for long-term care. Pressure is building in Congress and in many states to limit the growth of Medicaid spending, making it more likely that even the limited long-term health care options available to the aged poor will disappear just as the need for them is dramatically increasing.

Connecticut’s lawmakers need to review how the state administers Medicaid to bring more long-term health care options to an aging population and greater savings to taxpayers.