An estimated 69% of Americans will require long-term care services at some point in their lives, for an average of about three years, according to HHS. About 13% of adults pay for their care out-of-pocket, which will become more difficult to sustain due to the financial burden, says a new study by Health Affairs. For those with significant long-term support and services, their median amount of wealth would only allow for long-term home care for about 16 months at an average cost of $1,170 for 90 hours of home care a month.
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Tags: long term care
5 Medicare Advantage Sample-Size
The new benefits may not be much like short-term care insurance, let alone LTCI.
By Allison Bell – ThinkAdvisor – April 1, 2019
Medicare Advantage program managers abruptly encouraged insurers to jam a few non-medical “supplemental benefits” into their benefits packages for 2019.
Some insurers added the kinds of benefits that might be covered by a short-term care insurance or long-term care insurance (LTCI) policy, such as adult day care services, homemaker services, and support for caregivers.
Officials at the Centers for Medicare and Medicare Services (CMS) recently put more fleshed-out rules for “chronic care” benefits in a draft version of a bidding document for the 2020 Medicare Advantage program.
Insurance company executives now have time to decide, in an orderly way, if they want to build chronic care benefits into their 2020 Medicare Advantage plan benefits menus.
In theory, the chronic care benefits provision could be the start of Medicare creeping into the long-term care benefits business, or a dead end, or the beginning of an era in which Medicare simply provides want amounts to small promotional samples of LTCI-type samples. Medicare sample-size LTC benefits could help sell consumers on the idea of buying full-size short-care insurance or LTCI policies.
The recent Intercompany Long Term Care Insurance Conference presented a session on the topic. The speakers included Howard Gleckman of the Urban Institute, Jay Greenberg of NCO Services, and Anne Tumlinson, a consultant who previously served as a senior vice president at Avalere Health.
Here’s a look at five speaker insights about the new Medicare Advantage chronic care benefits, drawn from the speakers’ slidedeck.
The benefits offered in new short-term care insurance and LTCI policies tend to hold fairly steady from year to year.
Consumers who buy LTCI policies can lock in benefits for many years.
The new Medicare Advantage chronic care benefits “can vary from year to year,” according to the Medicare Advantage LTC session speakers.
In part because the opportunity appeared with such little advance notice, only a limited number of issuers submitted bids in 2019, according to the Medicare Advantage LTC speakers.
Issuers saw the 2019 supplemental benefits opportunity as a kind of pilot program.
“More will participate in 2020,” according to the session speakers..
Issuers see value in the idea of investing a little money in non-medical support services, such as a little help with transportation, laundry or caregiver respite care, to hold down preventable use of expensive acute medical services, according to the session speakers.
Many issuers would like to see a better risk-adjustment system in place before they add the new chronic care benefits, according to the session speakers.
One challenge is that issuers still need to hold rates down, and another is that issuers will feel pressure to sweeten important benefits with broader appeal, such as dental benefits, according to the session speakers.
The budget constraints could put tight limits on chronic care benefits value. This year, for example, the companies that have added adult day care benefits cover just a few days of adult day care. The coverage is much skimpier than the coverage available in typical convalescent care policies, or other short-term care insurance policies.
Issuers are supposed to target the new benefits at enrollees at high risk of needing expensive, preventable medical care.
That means that only certain enrollees will end up qualifying to use the benefits, which means that highlighting the benefits in marketing materials could mislead the many consumers who might have a need for the types of services covered but will not actually qualify to use their Medicare Advantage coverage to pay for the services, according to the session speakers.
More information about the Medicare Advantage chronic care benefits session, including a link to the presentation slidedeck, is available here.
Medicare Advantage plans are expanding benefits for long-term care
The options may be limited in 2019 but that's likely to change in 2020 and beyond
Article: Danielle K Roberts / Considerable
If you use Medicare, you probably feel that it does a pretty good job of covering your medical costs. That’s the case for most people, since the government-run insurance plan covers about 80% of outpatient expenses and even more for inpatient expenses.
However, you may not realize that Medicare does not cover one major expense that might be looming for you or your spouse: long-term care. Often, by the time that people realize this, it’s too late or too expensive to pick up long-term care insurance.
And while people with very low incomes can qualify for Medicaid to help them with long-term care expenses, everyone else is left to privately pay for their assisted living centers and nursing home care.
The long-term care gap
About two-thirds of those eligible for Medicare enroll in Original Medicare, or Medicare Parts A and B, which covers hospital and medical costs. Most people who enroll in Original Medicare also opt for a Medicare Part D plan, which covers prescription drugs.
Another option is to choose a Medicare Advantage plan: These plans, offered by private insurers, offer the same coverage as parts A, B and D, and can also include ancillary benefits that Original Medicare does not provide, such as dental, vision and hearing expenses or gym memberships.
Until recently, however, neither the Original Medicare or Part C offered any coverage for long-term care. That changed last year, when the Centers for Medicare and Medicaid Services (CMS) announced that they would begin allowing Medicare Advantage plans to provide some supplemental long-term care services to their members the following year.
The new coverage options
Starting in 2019, Medicare Advantage plans had the option to build in some supplemental benefits that fall into the realm of home and community-based long-term care.
Some of the new long-term care options include:
The goal of these newly allowed benefits is to prevent costly hospitalizations and help chronically ill beneficiaries continue living independently for months or even years beyond what they have been able to do in the past.
Other new benefits
A few other key new benefits were also announced last year:
Better coverage for brand-name drugs: Starting this year, the dreaded “donut hole” for prescription drugs will be eliminated.
When Part D was first introduced in 2006, insurance companies could and did charge members 100% of the cost of their brand name prescription drugs when they reached the coverage gap (or donut hole). The Affordable Care Act changed this and the percentage of the cost that members are responsible for has been slowly falling over the last few years.
This year, members pay no more than 25% of the cost of their brand-name drugs in the gap in 2019.
A new open enrollment period: This year, the Open Enrollment Period from January 1st to March 31st each year has been reinstated.
This allows Medicare beneficiaries enrolled in Medicare Advantage plans to either change from one Medicare Advantage plan to another, or they can disenroll from their Medicare Advantage plan and return to Original Medicare and a standalone Part D drug plan.
So if a beneficiary makes a mistake or finds that they don’t like their plan for any reason, they can make a one-time plan change during this period. It’s a welcome change that may make some beneficiaries feel less hesitant to try an Advantage plan, knowing that they won’t necessarily be locked in.
Beneficiaries should keep in mind, though, that when they return to Original Medicare from an Advantage plan, they may have to answer health questions and go through medical underwriting in order to add that plan.
The future of long-term care
While the new long-term care benefits will appeal to many people, unfortunately existing plans were initially slow to build in the new benefits this year.
This was likely due to limited time to incorporate the new benefits between the time of the CMS announcement and deadline for plan designs to be submitted to Medicare for 2019 year.
However, given the expected popularity of these changes, it is hopeful that more plans will incorporate some of these supplemental benefits in 2020 and beyond.
As costs of healthcare continue to inflate, it’s likely that more and more beneficiaries living on fixed income will begin to gravitate toward Medicare Advantage plans that offer lower premiums.
These potential new benefits and additional window to change their minds about their plan are certain to increase the number of beneficiaries who choose a Medicare Advantage plan as their coverage in the coming years.
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Medicare program is falling behind on LTC Support Needs
LTC Premiums Skyrocketing, Carriers Dropping Out
By Philly.Com – January 8, 2019
In its Q3 report to shareholders, Genworth Life Insurance Co. – recording a loss of $34 million from long-term insurance – said it has approval from state agencies for average rate increases of 53%. About 100 companies across America sold stand-alone LTC insurance in 2002, according to the National Association of Insurance Commissioners: today there are 17.
The problems hit from many sides, including years of low interest rates that cratered insurance companies’ investment earnings and overly optimistic assumptions factored into calculations about the cost of long-term care.
Tags: long term care
Medicare Advantage Plans Can Pay for Many
The Centers for Medicare and Medicaid Services is getting ready to let Medicare Advantage plan issuers add major new long-term care benefits to their supplemental benefits menus.
The Better Medicare Alliance, a Washington-based coalition for companies and groups with an interest in the Medicare Advantage has posted a copy of a memo that shows CMS is reinterpreting the phrase “primarily health related” when deciding whether a Medicare Advantage plan can cover a specific benefit.
Kathryn Coleman, director of the CMS Medicare Drug & Health Plan Contract Administration Group, writes in the memo, which was sent to Medicare Advantage organizations April 27, that CMS will let a plan cover adult day care services for adults who need help with either the basic “activities of daily living,” such as walking or going to the bathroom, or with “instrumental activities of daily living,” such as the ability to cook, clean or shop.
A Medicare Advantage plan could not, apparently, cover skilled nursing home care, or assisted living facility fees. But, in addition to adult day care, a Medicare Advantage plan could pay for:
The Better Market Alliance says the memo is a form of subregulatory guidance. It’s possible that CMS could revise the guidance, and there’s no indication whether any Medicare Advantage issuers will be in a position to add major LTC benefits to their benefits packages for 2019.
CMS said it would be changing the 2019 Medicare Advantage program benefits uniformity requirements in the preamble to a collection of 2019 Medicare program regulations posted in April.
The Medicare Advantage programs lets insurers offer consumers comprehensive plans that serve as an alternative to traditional Medicare coverage. CMS tries to control current costs, avoid any incentives for patients to get more care, and help patients shop for plans on an apples-to-apples basis by putting tight limits on the benefits the plan issuers can offer.
The Better Medicare Alliance serves many health care providers and provider groups. It also includes many insurance- and benefits-related players, including the National Association of Health Underwriters, the American Benefits Council, and Aetna Inc., Humana Inc., Scan Health Plan and UnitedHealth Group Inc.
Issuers of private long-term care insurance once treated Medicaid and Medicare benefits that “crowded out” private insurance benefits as a serious problem.
In recent years, however, as low interest rates, strict rate increase rules, and actuarial projection problems have reduced private insurers’ participation in the private LTCI market, the private issuers themselves have talked about the need for public-private partnerships.
Long-Term Care in America:
The AP-NORC Center’s fifth annual Long-Term Care Poll explores how older Americans feel about the services and support in their community, the country’s preparedness to meet the care needs of an aging population, and other attitudinal trends.
Results from the 2017 Long-Term Care trends poll find that two-thirds of Americans age 40 and older feel the country is not prepared for the rapid growth of the older adult population. The Associated Press-NORC Center for Public Affairs Research survey also finds that at the local level, less than half of older Americans say their community is doing a good job of meeting older adults’ needs for nursing homes, assisted living facilities, and home health care aides to provide long-term care. Additionally, a majority of older adults say they would like the federal government to devote a lot or a great deal of effort this year to helping people with the costs of ongoing living assistance.
The population of Americans age 65 and older is growing at an unprecedented rate. In 2014, there were 46.2 million adults age 65 and older, and this number is expected to more than double to comprise about 98 million older adults by the year 2060. The majority of these older adults will require at least some support with activities of daily living as they age—things like cooking, bathing, or remembering to take medicine.
Five Things You Should Know From The AP-NORC Center’s 2017 Long-Term Care Poll:
Tags: long term care