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The Long and Winding Road to Reform of Long-Term Services and Supports. Joshua M. Wiener, Ph.D. RTI International Washington, DC. 701 13th Street, NW – Suite 750 · Washington, DC 2005 Phone: 202-728-2094 · Fax: 202-728-2095 · Introduction.

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the long and winding road to reform of long term services and supports

The Long and Winding Road toReform of Long-TermServices and Supports

Joshua M. Wiener, Ph.D.

RTI InternationalWashington, DC

701 13th Street, NW – Suite 750 · Washington, DC 2005Phone: 202-728-2094 · Fax: 202-728-2095 ·

  • First major health reform debate since 1994
  • High priority for President Obama
  • Focus on acute care reform, with modest attention to LTSS
  • What will the final bill look like?
  • Will it be enacted?
plan of talk
Plan of Talk
  • How will acute care reform affect LTSS providers, workers and consumers?
  • What are the LTSS provisions in the health reform bills?
  • What are the main issues of comprehensive financing and delivery LTSS reform?
  • What are the likely political dynamics?
how acute care provisions affect long term services and supports providers and consumers
How Acute Care Provisions Affect Long-Term Services and Supports Providers and Consumers

5 major House and Senate bills

Providers are employers

Direct care workers often uninsured

16% of CNAs in nursing homes

30% of home health aides

People with disabilities have acute care needs as well as long-term care needs

12% are uninsured

Medicare beneficiaries with 2+ ADL problems have 4.5 times the expenditures of beneficiaries without ADL problems

what s in the health insurance components of the bills
What’s in the Health Insurance Components of the Bills?
  • Pay or play for employers, with small business exemption
  • Individual mandate with exemptions and penalties
  • Low-income subsidies for insurance purchase
  • Expansion of Medicaid
  • Insurance exchanges
  • Insurance reforms
  • Reduction of the Medicare Part D donut hole
what about long term services and supports
What About Long-Term Services and Supports?
  • With one exception, modest provisions
  • Grand policy
  • Community Living Assistance Services and Supports (CLASS) Act
  • Home and community-based services
  • Post-acute care
  • Nursing homes
  • Elder abuse
  • Chronic conditions and dual eligibles
grand policy sense of senate
Grand Policy: Sense of Senate

“It is the sense of the Senate that –

during the 111th Session of Congress, Congress should address long-term services and supports in a comprehensive way that guarantees elderly and disabled individuals the care they need; and

long-term services and supports should be made available in the community in addition to institutions.”

community living assistance services and supports act class act
Community Living Assistance Services and Supports Act (CLASS Act)

Voluntary social insurance program for LTSS care developed by Senator Ted Kennedy

Limits of private long-term care insurance

Voluntary public social insurance plan

Cash rather than service benefit of average of $50 per day

Self-financed by insured, estimated premium $122 per month

Students and low-income pay $5 per month

10-year budget window “saves” $59 billion

class act continued
CLASS Act (continued)

Adverse selection

Automatic enrollment unless opt out

Must pay premiums for 5 years before use

Initial enrollment limited to the working population

Minimalist definition of “working”

Excludes retired elderly who do not work

Excludes current population with disabilities who do not work

home and community based services
Home and Community-Based Services

Additional funds for Aging and Disability Resource Centers (ADRCs)

Extend Money Follows the Person (MFP) demonstration and change criteria for eligibility to residing in an institution for 90 days rather than 6 months

Community First Choice Option to provide broader range of HCBS without a waiver

hcbs continued
HCBS (continued)

Higher Medicaid match as incentive to states to offer HCBS

Require States to provide spousal improvement protections under HCBS waivers

Home health agencies required to submit quality data

financing medicare post acute care
Financing: Medicare Post-Acute Care

Medicare payment cuts to skilled nursing facilities and home health agencies to help finance reform

High profit margins on Medicare services

12.2% for home health in 2009

12.6% for skilled nursing facilities in 2009

Cross subsidy with Medicaid

Medicare Payment Advisory Commission “on steroids”

medicare post acute care cont
Medicare Post-Acute Care (cont.)

Post-acute care bundling demonstration


Medicare currently pays widely variable amount to variety of providers for same population

Single provider responsible for wide range of services, including post-acute care

Seeks to create incentives for coordination across providers

Hospital-dominated system?

What happens to post-acute care?

nursing homes
Nursing homes

Requires disclosure of ownership

Additional staffing data

Rules on facility closure

Demonstration projects on culture change and information technology

Training for certified nurse assistants required on dementia and abuse

Requires background checks

Standardized complaint form and funds for investigations

elder abuse
Elder Abuse

Establish elder abuse, neglect and exploitation forensic centers

Add abuse information to Nursing Home Compare website

Small increase in funds to states to investigate elder abuse and Long-Term Care Ombudsman Program

chronic disease dual eligibles
Chronic Disease/Dual Eligibles

Establishes a federal Coordinated Health Care Office within CMS

Medicaid state option to establish “health homes” for enrollees with chronic conditions with 90% Federal match for 2 years

Medicare demonstration of Department of Veterans Affairs’ Home-Based Primary Care program

Extend Special Needs Plans (SNPs), with new frailty adjustment payment methodology for some plans

chronic disease dual eligibles cont
Chronic Disease/Dual Eligibles (cont.)

Hospice and end-of-life care

Medicare hospice concurrent care demonstration

Medicaid hospice concurrent care for children state option

Prohibits use of funds for assisted suicide

Mandates revision of payment methods for Medicare hospice

the fire next time long term supports and services
The Fire Next Time: Long-Term Supports and Services

Large projected growth in the number of people with disabilities

$231 billion spent on long-term services and supports in 2006

People with long-term care needs have high acute care costs


population aged 80 as percentage of total population 2000 and 2040
Population Aged 80+ as Percentage of Total Population, 2000 and 2040


Germany 3.7 8.7Ireland 2.6 5.5Netherlands 3.2 7.6Sweden 5.0 7.9United Kingdom 4.0 7.3United States 3.3 6.9Source: OECD, 2005.


public and private expenditures on ltc for older people as percentage of gdp 2000
Public and Private Expenditures on LTC for Older People as Percentage of GDP, 2000

Source: OECD, 2005.



Projected Public Long-Term Care Expenditures (All Ages) in Selected Countries, as a Percentage of GDP, 2005 and 2050


Source: OECD, 2006.

options for reform financing
Options for Reform: Financing

Political divide over role of government programs vs. private sector initiatives

Key issue is fiscal sustainability for the future

Private insurance and reverse mortgages

Social Insurance, Medicare and Medicaid expansion, and increases in Older Americans Act programs

Major changes (including private insurance) require large increases in direct government spending or expensive tax incentives


options for reform service delivery
Options for Reform: Service Delivery

Consensus for more balanced long-term care system and more consumer control

Participant-directed home care, money follows the person, and assisted living

Existing legal authority vs. mandates

More direct government service funds (e.g., Medicare, Medicaid, Older Americans Act) or infrastructure grants



Long-term Services and Supports care not the centerpiece of health reform, but will play a role

Health care for uninsured must be solved first

Why is LTSS so hard to reform?

Comprehensive LTSS reform will cost money, but low-cost options can make contribution


Joshua M. Wiener, Ph.D.

Senior Fellow and Program Director

for Aging, Disability and Long-Term Care

RTI International

701 13th Street, NW

Suite 750

Washington, DC 20005

202-728-2094 (voice)

202-728-2095 (fax)