The House Health Bill: Bad For Seniors, Bad For Long-Term Care Insurance

The House-passed health bill could further batter the already-beaten down market for long-term care insurance. And drive even more middle income seniors into impoverishment and onto Medicaid long-term care.

Here’s why:  The House bill, called the American Health Care Act (AHCA) would significantly raise health insurance premiums and out-of-pocket medical costs for buyers aged 50-64. And that is exactly the age at which people think about buying long-term care (LTC) insurance. While only about 9 percent of buyers are under 50, two-thirds are age 50-64, according to an industry survey.

Seniors Had A Terrible Week In Washington. It Could Get Worse

Congress and President Trump took dead aim at seniors and younger people with disabilities this week. First, Congress voted to cut or freeze funding for key federal senior service programs. Then the House passed its bill to replace the Affordable Care Act—a measure that would make health insurance unaffordable for many people aged 50-64, allow insurance companies to sell policies that exclude important benefits for  people with chronic conditions, and slash Medicaid spending for those who need long-term supports and services.

Fix The Affordable Care Act By Letting People 55-64 Buy Into Medicare

Congressional Republicans seem once again stymied in their efforts to “repeal and replace Obamacare.” So here is a partial solution that can be a winner for both political parties, the insurance industry, and consumers: Allow people 55-64 to buy into Medicare. And enhance the deal by letting Medicare Advantage plans offer some long-term supports and services, such as personal care, as part of their benefit package.

The idea of a Medicare buy-in has been around for years. It was proposed by President Bill Clinton and endorsed again in the recent presidential campaign by Hillary Clinton. About now, you are thinking that the Clinton pedigree is a death sentence in a Republican-controlled government.

How Health Systems Can Provide Better Care For Seniors

Older adults are among the biggest victims of our often disorganized, uncoordinated, and impersonal system of medical care. Backwards financial incentives encourage useless tests and dangerous hospital admissions and discourage important social support, personal assistance, and preventive care.  The result is that Medicare pays hundreds of billions of dollars for treatment that not only fails to improve the quality of life of older adults, it often needlessly harms them.

Men Are Family Caregivers Too

About four in 10 family caregivers are men—sons, husbands, brothers, sons-in-law, or neighbors. We are nearly always ignored in discussions about caregiving, lost in the stereotype of the family caregiver as a 40-something daughter.

Finally, AARP is shining a much-needed spotlight on these men. A new study by Jean Accius at AARP’s Public Policy Institute paints a valuable, and rare, picture of male family caregivers. The organization has supplemented Jean’s paper with a series of videos  highlighting men who care for loved ones with serious illnesses.  It is even sponsoring a public service ad starring tough guy actor Danny Trejo. The message: “Caregiving is tougher than tough.”

We May Be About To See A Big Change In How Long-Term Care Insurance Is Priced

The way you pay for long-term care insurance policies may be about to change in a big way.

Genworth, the biggest seller of stand-alone long-term care insurance, is about to ask state insurance regulators for permission to fundamentally revise the way it structures premiums. Instead of holding premiums flat for several years followed by big double-digit rate hikes, it wants to be able to revise premiums annually.

In this design, unfortunately called the Annual Rate Sufficiency Model, buyers of new policies would likely see modest, single-digit rate hikes each year or two. If Genworth thinks it is likely to pay fewer claims than expected or if investment income is higher than projected, consumers might even see small rate reductions in some years.

Despite Medicare, Seniors Will Pay More For Medical Care In Coming Years

Medicare is a critical lifeline for older adults who need health care as they age. But a new study shows that over the next two decades, out-of-pocket medical costs for older adults are likely to rise significantly, even with access to Medicare.

By 2035, a typical senior will spend one out of every seven dollars of retirement income on medical care, a 40 percent increase from 2012. The study, by Laura Hatfield, Thomas McGuire, and Michael Chernew of the Harvard Medical School and my Urban Institute colleague Melissa Favreault, projected that out-of-pocket cost increases will hit poor and near-poor households hardest.  It was published in the journal Health Services Research (paywall).

The House GOP’s Medicaid Plan Will Mean More Flexibility, Less Money For States, Worse Care

House Republicans are right that Medicaid needs to be more flexible. But more flexibility with far fewer dollars won’t improve care for seniors, younger people with disabilities, or other beneficiaries of the program. It is possible to cut red tape without slashing spending. Congress should give it a try.

Medicaid is a critical safety net for people who need personal assistance and other supports because they are frail or disabled. Besides families themselves, the program is the biggest payer of long-term supports and services, spending about $140 billion annually on this care for frail elders and younger people with disabilities. And it helps the most vulnerable seniors. While the rules vary by state, in general people are only eligible if they make less than about $735-a-month, have less than $2,000 in financial assets, and have a high level of functional or cognitive impairment.

Trump’s Budget Framework Points To Big Cuts In Programs For Seniors

President Trump’s initial budget framework would slash programs for seniors and younger people with disabilities, especially those aiming to remain at home rather than move to a nursing home or other residential care. Combined with the House GOP’s proposed health plan, it may severely limit access to federally-funded medical care, personal assistance, and other supports and services.

A Closer Look At The House GOP Health Bill And Seniors: It Isn’t Getting Better

From the perspective of older adults, there is little good to say about the House Republican health care bill. The American Health Care Act (AHCA) would significantly raise insurance costs for people in their 50s and 60s, reduce important Medicaid benefits for the frail elderly, and put more financial pressure on Medicare.

Last week, I took a first look at what the plan would mean, but we have more information about the effects of the AHCA, so let’s take a closer look: