09 June 2009

Long Term Care - Time For change

The Senate Select Committee on Aging held its second hearing this year on the key topic of long-term care on Wednesday, June 3. The first was back in March and following it, Committee Chairman, Herb Kohl (Dem-WI) urged the Senate to include changes in the coverage, financing, and governing standards of long-term care services and supports as part of comprehensive health reform.

Now, after last week's hearing, Senator Kohl called for stronger consumer protections and greater transparency within the long-term care insurance industry as more and more states are joining with the industry in calling for consumers to purchase LTCI.

Many seniors are confronted with devastating premium increase while many others do without due to prohibitively high premiums with great state-by-state variation in premiums and consumer safeguards for comparable plans, according to the committee's report. It cites one company which raised its rates by 40%.

"Until we can guarantee that consumers have adequate protections, and that premiums don't skyrocket down the road, long-term care insurance is not ready to be part of the health care reform solution", said Kohl.

The Kaiser Family Foundation put forth a study in conjunction with the hearing which reported, "American families today are struggling to pay for long-term are, caught in the cross hairs of an economic meltdown dramatically reducing the personal resources that have fueled over 25 percent of the nation's long-term care spending until now. The sources of out-of-pocket financing, which include home equity, personal savings, and income from adult children have provided critical private funding for a long-term care system in which insurance has played a very small role, covering only about 10 percent of all seniors."

The Kaiser analysis went on to cite High Cost, Health-Risk Deniability, Complexity of the Various Plans, and the Time Lag between purchase and use as the current primary impediments to consumers desire to buy into LTCI plans.

The report provides in-depth analysis and comparison of two suggested alternatives to the current situation: Employer Based Plans and Medicare Partnership Programs. Each provides some answers, but each also, raises many questions.

Older Americans need to keep themselves informed and involved on this critical health care issue, or they will find that once again the lobbyists of the insurance oligarchs will have their way and LTCI will remain out of reach for most of working America.

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