It’s hard to get rid of a major part of the health-reform law without leaving a vibrant debate behind. One week after the Obama administration announced it would stop implementing the CLASS Act, there’s still a lot of discussion about what halting the long-term care program means, and whether it proves that health reform is a failure.
One point, however, has found near-universal agreement: our long-term care problem has to be fixed. “The CLASS Act was a failure, but the need for something like it remains and will grow,” writes Norm Ornstein of the American Enterprise Institute.
Earlier this week, I rounded up four ways to fix long-term care. I’d add to that a plan that William Galston of the Brookings Institution outlined in a very prescient piece for American Interest magazine last month. In “Old, Gray and Here to Stay,” he builds off of two existing policies: the Long Term Care Security Act, which requires the federal government to offer long-term care insurance to its employees, and the Long-Term Care Partnership Program, a project from the early 1990s that allowed Medicare and private insurers to cover long-term care in new ways.
Pivoting off that, here’s Galston’s four-pronged proposal:
-Effective at age forty, every adult would be required to purchase a long-term care insurance policy with certain specified features: a five-year term, a benefit of at least $150 per day, automatic inflation adjustment and a low deductible.
-Individuals in households with incomes between 150 and 300 percent of the poverty-level base would receive income-adjusted premium subsidies. Those below 150 percent would be enrolled for free.
-The Federal government would create a competitive bidding process along the lines of, but broader than, the current system for Federal employees, with the aim of creating a large menu of carefully vetted, readily comparable choices.
-After the expiration of the five-year benefit period, Medicaid would assume full financial responsibility for remaining costs. Individuals in this category would not be required to spend down their remaining assets to qualify for coverage.
The five-year policy would likely stretch long enough to cover the period of time an individual would need long-term care services, Galston explains. Starting premiums at 40 would make them much lower than for a more elderly adult. Medicaid still remains the fallback option if an insurance policy is exhausted.
Is this policy politically tenable? The inclusion of a mandate, as well as new insurance subsidies, could make it a tough sell. “Our current fiscal challenges make it hard to think about taking on new responsibilities,” Galston concedes. But with the population getting older and more reliant on long-term care, we’re likely going to have to do something.