Goals for State-Federal Action

Policy:                              Long Term Care

Committee:                      Health

Tpye:                               Consent

The development of a comprehensive long-term care program for elderly and disabled people is critical. Without the development of such a program, long-term care expenditures will continue to overwhelm state and federal health care budgets, limiting needed expenditures for primary and preventive health care. States should be given new options for setting financial and functional criteria to qualify for long-term care services. In addition, NCSL supports the development of expanded options for private long-term care insurance, flexible life insurance products, and home equity sharing programs, such as reverse annuity mortgages. NCSL also supports initiatives to provide incentives to employers to offer and for individuals to establish health savings accounts and other innovative financing options to provide support for long-term care services. Finally, much of the long-term care services provided to individuals today are provided by family members. NCSL supports efforts to assist family members who are caregivers, including tax incentives and programs that provide support services, such as respite care, for family caregivers. It is critically important to acknowledge the important role of family caregivers as part of the continuum of care in the provision of long-term care services and to provide needed support to maintain this important component of our long-term care infrastructure.

Medicaid Long Term Living Flexibility Option/Demonstration Program

Under a new state/federal partnership that uses a new formula for calculating federal funds to be spent in a state for long-term care (alternative formula), a participating state would receive federal funds based on appropriate medical and long-term care services costs, inflation, demographic factors and other appropriate factors, based on a three year rolling average. States, as a condition of receiving federal funds under this option, would be required to establish a comprehensive long-term care program for elderly and disabled individuals. The new optional program would preserve the Medicaid entitlement to states and individuals. Should the amount calculated under the alternative formula not be enough to provide full individual entitlement to services, then supplemental federal funding will be provided to meet those requirements. States would determine eligibility standards and criteria and program benefits. Each state would be required to provide a continuum of long-term care services that would include, but not be limited to: home and community-based care, nursing facility services, nutrition services, home health, hospice, supportive services and adult day care. This approach permits states to offer long-term care services in the most appropriate setting, respecting the preferences of individuals and their families, without the need for time-limited waivers. States could implement the program in a portion of the state during the initial years of program. States would be responsible for submitting a state plan and for periodically reporting program results to the Centers for Medicare and Medicaid Services (CMS). States could decide to end participation in the program, even after implementation with notice to CMS within a certain period of time.

Increasing Options for Home and Community-Based Care

NCSL continues to support the development of more home and community-based options under Medicaid to provide long term care services. States should be encouraged to develop innovative programs to improve the long-term care system. NCSL urges the Administration and Congress to work with states to develop assessment tools that will help states better identify what level of services individual clients need and the most appropriate settings for the client to receive care. These assessments should be made available to all elderly and disabled individuals to help them plan for their long-term care needs.

Long-Term Care Insurance

Recognizing consumers can potentially benefit from the purchase of long-term care insurance, NCSL supports strong federal action to protect consumers of long-term care insurance from predatory pricing or inadequate benefit plans, and to speed the development of long-term care insurance as a viable alternative or complement to Medicaid support for long-term care services. At the same time, tax credits, partnership programs, and other incentives should not be seen as a tool for reduced funding for Medicaid. While the states will continue to take primary responsibility for the regulation of long-term care insurance, NCSL supports the development and evaluation of programs and initiatives that would:

provide preferential tax treatment for individuals who purchase qualified long-term care insurance;
provide tax incentives for private employers and a Medicaid bonus program for state and local government employers to encourage the them to offer long-term care insurance as a benefit;
encourage and provide incentives to employers to offer long-term care insurance, as a condition of receiving federal benefits, such as business tax credits;
make long-term care in policies portable;
repeal the provision in the Omnibus Budget Reconciliation Act of 1993 that restricts the ability of states to develop programs that provide limited asset protection and other incentives within the Medicaid program to individuals who purchase long-term care insurance and the establishment of a new, updated “Long-Term Care Partnership” program to encourage more people to purchase long-term care insurance. NCSL urges Congress to study options for establishing reciprocal agreements between states to facilitate the portability of the new partnership products. NCSL also urges Congress to grandfather existing partnership states into any new partnership program.

Other Federal Programs

The role of Medicare in providing long term care coverage to elderly and disabled people should be strengthened. In addition, the role of Older Americans Act and Social Service Block Grant funds in providing support services should be clarified.

Research on Alzheimer’s Disease and Related Disorders

NCSL supports continued federal funding for research that will: (1) lead to the development of new drug treatments; (2) assist in disease management; and (3) improve the early diagnosis of these conditions.

Assistance for Family Caregivers

NCSL supports federal initiatives to assist family members who are caregivers. These initiatives include tax incentives and programs that provide support services for family caregivers.

Return to Fall Forum Policies December 2005