Results tagged “Caring for our Parents” from Caring For Our Parents

Money Follows the Person is a cornerstone of the federal government's effort to move Medicaid beneficiaries from nursing homes into the community. But a new study commissioned by Medicaid itself shows how difficult those transitions can be. In the 30 states that have been testing the program over the past three years, only 8,500 people have used MFP to return to their communities.

That's just a tiny fraction of the nearly 1 million people who are eligible, and only about one-quarter of the 35,000 the participating states initially hoped to move. And of the 8,500 who have enrolled in the program, one-third lived in just one state--Texas. By contrast, California has signed up only 186 people since MFP began, and New York only 165, according to the study done by Mathematica Policy Research Inc.  

The concept makes great sense. Move people out of nursing homes, where most don't want to live and where the costs to Medicaid are extremely high, and help them get back to their homes or other community residences. Unfortunately, states have struggled to turn this concept into reality.     

Most troubling for the frail elderly, it turns out that while three out of every four people eligible for the program are age 65 or older, only one-quarter of participants are seniors. Money Follows the Person has been far more successful for younger adults with physical and developmental disabilities than for the frail elderly. 

Mathematica identified several reasons why so few frail elders participate. The biggest may be that they have no home to return to. In the original design, MFP participants had to have been nursing home residents for at least six months. Because many elderly people sold their homes or given up their apartments when they moved into a nursing facility, it was not possible for them to return to their communities. In addition, in many states participants were not allowed to move into assisted living facilities.

Just as troubling, many states don't have enough subsidized rental housing or funding for necessary home and community based services, such as personal aides or transportation. Unfortunately, the growing wave of state budget cuts is likely to make that problem even worse.  

Still, there is some good news. The 2010 health reform law (the Affordable Care Act) allows people to use the program after only 90 days in a nursing facility, instead of six months. That will make another 112,000 people eligible to participate. The health law also promised an additional $1.75 billion in funding, gives states new flexibility in providing community-based services, and continued MFP experiment until 2014.

Long-term care experts and top government officials have had high hopes for Money Follows the Person. They see it as key to helping both the frail elderly and younger people with disabilities receive the supports and services they need at home and not in nursing facilities. But as the Mathematica study suggests, MFP has so far fallen far short of those expectations.   

Powerful Republicans are pushing the twin ideas of capping the federal contribution to Medicaid and eliminating federal regulation of the program. These changes would do profound damage to the Medicaid benefit for long-term care, whether it is provided at home or in nursing facilites.

This plan would turn Medicaid from a federal entitlement into a block grant. Over time, states would be responsible for paying a growing share of the program costs but in exchange would have broad flexibility over who to cover and what benefits they'd receive. In such an environment, chances are good that fewer aged and disabled would be eligible for benefits and they'd receive less assistance than they do today. At the same time, providers such as nursing homes and home health agencies would likely get lower Medicaid payments even though the program reimbursements are already at dangerously low levels.  

Today, the federal government pays about 57 percent of Medicaid costs (the actual amount varies from state to state and ranges from 50 percent to about 80 percent). While the elderly and disabled account for only 25 percent of the 50 million Medicaid enrollees, the program spends two out of every three of its dollars on this population. More than one-third of the total Medicaid budget, or $125 billion, went to long-term care supports and services alone in 2009, according to a new study by the Kaiser Family Foundation.

Under the current arrangement, the federal government pays its share no matter how quickly Medicaid costs rise. Thus, because Medicaid rose by 7.7 percent in 2009 (mostly because the recession drove many newly-unemployed into the program), the federal contribution increased to keep up. In fact, Washington's share actually grew even more thanks to the much-reviled 2009 stimulus law.

By contrast, under a block grant the federal share would increase only up to a cap, say equal to the growth rate of the economy plus one percent. In 2009, this would have resulted in no increase in federal payments for the program. As a result, states would have had to scale back their Medicaid programs, including their long-term care services.

Over time, the federal contribution would fall significantly, leaving the states with more and more responsibility for the program and less and less assistance to pay the bills. Governors who support a block grant insist it would drive greater efficiencies.And it might, for instance, make it easier for states to expand their home and community based long-term care programs. 

But it is also likely to generate major cuts in both benefits and reimbursements. In addition, without minimum federal standards, the differences among state long-term care benefits, already dramatic, would only grow.As a result, residents of one state may receive much better long-term care than residents of a neighboring jurisdiction.  

Despite these risks, GOP governors came to Cngress today to demand the changes. Mississippi Governor Haley Barbour, who is mulling a presidential bid--told a congressional committee that states should not have to "kow-tow" to the federal government and insisted the program be turned into a block grant. Mississippi, as it happens, recieves a greater federal Medicaid payment than any other state.

Even more troubling, these Medicaid cuts would come on top of what are likely to be freezes or cuts in non-Medicaid benefits for the frail elderly, such as nutrition, energy assistance,and housing.  

My guess is that much of this call for a Medicaid block grant is political posturing. It is hard to believe that many governors would turn their backs on hundreds of billions of dollars in federal aid at a time when they are struggling to balance thier budgets. I suspect what Barbour and his colleagues really want is the money with less regulation. But given federal budget pressures, their GOP friends on Capitol Hill may give them both.        

As Medicaid budget pressures grow, more states are turning long-term care over to private managed care companies. USA Today reports that six states now require both frail elderly and younger adults with disabilities to enroll in insurance-run Medicaid managed care plans. Another 10 states are planning to either create or expand these programs, according to the story.

The reason, of course: money. States pay the insurance plans a fixed amount to care for these patients. And the private insurers say they can provide quality care for less cost through their use of care coordinators and by keeping many people at home. 

Tennessee, for instance, pays private insurers an average of $4,400 per patient per month to provide Medicaid long-term care services. Under this system, if the insurer can provide care for less, it makes a profit. If its costs are higher, the insurer is at risk for the difference. This is a big incentive to create a care plan built around home care, which for many beneficiaries can be far less costly than a skilled nursing facility.

USA Today reported that one Tennessee insurer, Amerigroup, spent about $3,000 per month to care for one patient at home. The cost for this patient in a nursing facility would have been almost $4,600 per month and a money-loser for the insurer.     

Medicaid managed care isn't new. States have been using it for acute care beneficiaires (mostly low income mothers and kids) for years. But long-term care patients are a very different challenge.

One one hand, more than any other population, the frail elderly need to have their care coordinated. They have complex medical needs, often suffer from multiple chronic diseases, and frequently take many medications. If a mix of care managers, personal assistance, nursing, and other services and supports can help them get the care they need at home for less money, that is great.

This flat fee, or capitated, payment model works well with programs such as hospice and PACE, for instance.   

On the other hand, many insurance companies badly damaged their reputations in the 1980s and '90s with managed care plans that seemed more intent on maximizing profits than care. It will be important to put protections in place to be sure that the frail elderly, who are often unable to advocate for themselves, are getting the care they require.

The other problem with Medicaid managed care is that these beneficiaries often receive their physician and hospital care through Medicare, not Medicaid. Because these two programs are so poorly coordinated, seniors who transition from, say, home to hospital to rehab and back to home may not get proper care as they cross settings.

This lack of coordination between Medicare and Medicaid also creates some perverse and dangerous incentives. If, for instance, a Mediciad managed care patient winds up in the hospital as a result of poor care, neither Medicaid nor the managed care firm is on the hook. The bill, instead, is paid by Medicare.

If managed care is going to work well, there will have to be much closer delivery and financial relationships between these two payers, as there is with successful programs such as PACE or through provider-based managed care mechanisms such as Accountable Care Organizations.           

President Obama's 2012 budget is the latest indication of the growing pressures government-provided aging services will face in coming years.  And as tight as his budget is, spending on assistance for poor and frail seniors is likely to end up much lower than Obama proposed. With congressional Republicans vowing to cut $100 billion from domestic spending over the remaining seven months of the current budget year, and even more from Obama's proposals for next year, the future for federal funding for aging services is grim.

There is some good news for seniors in Obama's fiscal plan. For instance, he has asked for a modest increase in home and community-based supportive services. However, the budgets for many other key programs, including Meals on Wheels and other nutrition programs, would be frozen. Respite care remains grossly underfunded, even though it received a modest budget increase.

On the other hand, Obama proposed cutting the major subsidized senior housing program (called Section 202) by $68 million from the 2010 budget and low-income energy assistance for those living at home by $2.5 billion. The community services block grant program would be funded at $350 million, just half its 2010 level. These are grants for local non-profits that provide housing, nutrition, and other supportive services for very low-income people, including seniors. Overall, Obama would cut the Administration on Aging budget by almost $181 million, or about 8 percent, from 2010 levels.

Keep in mind, though, that once Obama and Congress agree to a final compromise budget (probably sometime next fall) cuts will be deeper than Obama has proposed. Also remember that these cuts so far largely exclude changes in Medicare and Medicaid, which are exempt from the annual budget process but face enormous financial and political pressures of their own. 

Worse, as federal budget pressures grow, these cuts are likely to be only one step in a long and painful process of scaling back government assistance for the elderly. As I have suggested in the past, in such an environment, it will be critically important for state and local governments, senior service providers, non-profits, and advocacy groups to rethink their own future roles in caing for our parents.    

President Obama's 2012 budget is the latest indication of the growing pressures government-provided aging services will face in coming years.  And as tight as his budget is, spending on assistance for poor and frail seniors is likely to end up much lower than Obama proposed. With congressional Republicans vowing to cut $100 billion from domestic spending over the remaining seven months of the current budget year, and even more from Obama's proposals for next year, the future for federal funding for aging services is grim.

There is some good news for seniors in Obama's fiscal plan. For instance, he has asked for a modest increase in home and community-based supportive services. However, the budgets for many other key programs, including Meals on Wheels and other nutrition programs, would be frozen. Respite care remains grossly underfunded, even though it received a modest budget increase.

On the other hand, Obama proposed cutting the major subsidized senior housing program (called Section 202) by $68 million from the 2010 budget and low-income energy assistance for those living at home by $2.5 billion. The community services block grant program would be funded at $350 million, just half its 2010 level. These are grants for local non-profits that provide housing, nutrition, and other supportive services for very low-income people, including seniors. Overall, Obama would cut the Administration on Aging budget by almost $181 million, or about 8 percent, from 2010 levels.

Keep in mind, though, that once Obama and Congress agree to a final compromise budget (probably sometime next fall) cuts will be deeper than Obama has proposed. Also remember that these cuts so far largely exclude changes in Medicare and Medicaid, which are exempt from the annual budget process but face enormous financial and political pressures of their own. 

Worse, as federal budget pressures grow, these cuts are likely to be only one step in a long and painful process of scaling back government assistance for the elderly. As I have suggested in the past, in such an environment, it will be critically important for state and local governments, senior service providers, non-profits, and advocacy groups to rethink their own future roles in caing for our parents.    

In an important speech for those interested in the future of the CLASS Act, federal Department of Health and Human Services Secretary Kathleen Sebelius said today that the program must be self-supporting but conceded that, as designed, it may not meet that goal. 

"The program must be able to pay for benefits over the long-term with the premiums it takes in,' she told the Kaiser Family Foundation. "No taxpayer dollars will be used to pay for CLASS benefits.This is non-negotiable."

At the same time, however, Sebelius said she was open to major changes to the program and acknowledged that the national, voluntary long-term care insurance system that was included in the 2010 health reform law "is not perfect." And, in an apparent nod to critics, said "it would be irresponsible to ignore the concerns about the CLASS program's long-term sustainability in its current form."

To respond to those fears, she suggested that HHS has broad authority to restructure key provisions of the law. Sebelius said that, besides sustainability, CLASS contains only two other "key principles." The first is that consumers must have the ability to direct their own services--a reference to CLASS' cash benefit. The other is that there should be no traditional underwriting for health status such as is included in private long-term care policies.

However, she explicitly opened the door to other highly controversial changes to the law. These include tightening its "at work" requirement, changing its premium structure, and assisting employers who offer CLASS benefits to their workers. 

The biggest change would make it tougher for some people with disabilities to enroll in the program. The law allows anyone 18 and older to sign up for CLASS as long as they earn just $1,100 a year, which makes it possible for many working people with disabilities to buy coverage. This is an extremely important change for them, but such a flexible standard has been sharply criticized by industry actuaries.

The problem is that this design may mean that those buying CLASS insurance will be more likely than average to claim benefits under the program. If that happens, the government will have to increase premiums to pay those claims which in turn will discourage healthy consumers from buying coverage. This will eventually lead to a "death spiral" that will destroy the program.

Sebelius said her office is reviewing that at-work requirement, although it is unclear how much flexibility she has to change it without an amendment to the law.

Other changes she is considering include:

Replacing a flat premium with one that increases annually with inflation. This postive change would allow for relatively low initial premiums, especially for young buyers.

Imposing anti-gaming rules. These would prevent consumers from going in-and-out of coverage during their lives without paying penalties.

Easing the burden on employers that offer CLASS insurance. This could be another key change. The law automatically enrolls workers in CLASS, but only if they get coverage through their job. Currently, however, the law includes no incentives for employers to participate.

Creating an aggressive marketing campaign for long-term care insurance. This change could attract broad insurance industry support. But coming up with the funding will be a huge challenge, especially given severe budget pressures and the strong opposition to CLASS from congressional Republicans.

Tailoring benefits to individual needs. The law appears to require Sebelius to approve only a single policy. But today she suggsted she might have the flexibility to approve multiple coverage options. This could be another key change.

Sebelius' speech today was a major acknowledgement that CLASS as currently designed is in deep trouble--both politically and as an insurance program. By recognizing the flaws that some of us have been noting for more than a year, she has taken the first steps towards making CLASS successful. The question now is whether it is not too late given the broad opposition to the program that has been building for months on Capitol Hill. 

Prepare yourself for big new cuts in government support for elder care.  

In his State of the Union address last evening, President Obama called for a five-year freeze on a narrow slice of the federal budget. Unfortunately, programs subject to the freeze would include many that are critically important to the frail elderly and younger people with disabilities--especially those living in the community.

This is only the beginning of what will be a very difficult period. Yet it is an opportunity for communities to pull together to provide services that government may no longer offer.

The freeze would not include Medicare or Medicaid, although Medicaid long-term care benefits are already being cut at the state level. However, it is very likely that programs such as meals-on-wheels, adult day care, transportation, housing, aging and disability resource centers, and Area Agencies on Aging would all be hit by this freeze.

It is not clear exactly how the freeze would work. It could be an across-the-board cut in all so-called domestic discetionary programs. These are programs that are subject to annual congressional review, but exclude entitlements such as Medicare, Medicaid, and Social Security. Alternatively, Congress could pick and choose which programs to cut, as long as the total amount of all domestic non-entitlement spending did not rise from year to year.

Either way, a freeze will inevitably result in fewer services since demand for this assistance is growing as the population ages and the cost of services rises.

Congressional Republicans are already criticizing Obama's plan as too weak and vow to cut even more deeply into these programs. Some would return spending to 2008 levels, others to 2006 funding. However it finally works out, there is little doubt that many of the long-term care supports and services that seniors now rely upon are in line for major cuts.

With a national debt of $14 trillion and annual deficits of more than $1 trillion, there is no doubt that government spending is going to be trimmed--perhaps quite substantially.It is also likely that sooner or later, federal payments for Medicaid services will also be slashed. One can hope that an eventual budget deal will eventually include tax increases as well, which would help soften the spending blow. But in the current political environment, that is not likely--at least until after the next presidential election.

So what do families and advocates do? I believe we need to begin to look for community, non-government solutions. If transportation services are cut, we should pull together to create volunteer ride programs. Senior villages are one way to build such an infrastructure. So are more informal groups organized around neighborhoods, churches, synagogues, or fraternal organizations.

If budgets for government-funded resource centers are slashed, we should support private non-profits that pick up the slack.(Full disclosure: I serve on the board of one of these--the Jewish Council for the Aging of Greater Washington--and as an adviser to another--Caring from a Distance). 

As needs grow and government services shrink, we all face a huge challenge. But it is also an opportunity to rethink our obligations to, not only our own parents, but to our neighbors and friends. I hope we will be creative enough to take up this challenge.    

The news for critical long-term care services and supports provided by the states--either through Medicaid or other funding--keeps getting worse. The toxic combination of a still-slow economy, huge structural budget pressures on all levels of government, and growing demands for aging and disability services is leading to ongoing cuts in both critical benefits to individuals and payments to providers.

The latest evidence comes from two new reports. Following an extensive survey of state officials, AARP reports that 31 states cut their non-Medicaid long-term care services programs in Fiscal Year 2010 and at least 28 expect to slash them in the coming budget year. These essential programs include home-delivered meals, transportation, adult day care, housing, and foster care.

At the same time, a report by the American Health Care Association--which represents mostly for-profit nursing homes-- concludes that skilled nursing facilites are losing increasing amounts of money on their Medicaid long-term care beds. It concludes that nursing facilities are paid $17 per day less for long-term care than it costs them to provide these services. It is easy to criticize these results as self-serving, but the general trend is hard to dispute. And it could result in dramatic cuts in these long-term care resources. While this may not be a short-term problem in communities with an oversupply of nursing homes, this trend may already be curbing services in low-income areas. 

The AARP study reported that only a handful of states cut Medicaid benefits last year, but that was because the federal government, as part of its stimulus effort, increased its share of program payments. In addition, states that took the extra federal money were barred from cutting Medicaid benefits--although they could trim or freeze provider payments. Normally, the federal government pays about 60 percent of the cost of Medicaid while the states pay the rest (the amount varies from state to state).

However, this additional federal Medicaid funding is already winding down, and will disappear completely on July 1. Even more troubling, AARP found many states built the higher federal payments into this year's budgets, a decison that will force even deeper cuts in state programs as those dollars dry up. Just this week, lawmakers in Texas and Ohio proposed major cuts in Medicaid.  

AARP also asked state officials whether they intended to pursue additional federal funding for home and community based services that's been promised under the 2010 health reform law. Despite their serious financial shortfalls and the growing interest among policy analysts and advocates in expanding community services, state officials were remarkably cautious about whether they'd embrace these initiatives.

I'll have more to say about these studies soon, but they are both worth reading.       

In the decade between 1999 and 2008, almost 3,000 nursing homes closed while the number of skilled nursing facility beds shrunk by nearly 100,000, or about 5 percent, according to a new study in the Archives of Internal Medicine. In a nation with more nursing homes than McDonald's, and at a time when long-term care can be provided in other settings, that may not be a bad thing. These days, many frail elderly receive care at home or in assisted living facilities, settings they often prefer to skilled nursing facilities.

But the Archives study by Zhanlian Feng and coauthors also raised some serious concerns. The report concluded that many of these closures occured in minority and low-income communities, the same areas where other care alternatives may be unavailable.

Other studies have shown that relatively few assisted living facilities--which are overwhelmingly private pay--are located in these neighborhoods. In addition, while data are scarce, it appears that many low-income and minority serniors may have limited access to high-quality home care. In other words, for one segment of the population, good care may increasingly be unavailable. 

A study published last year in Health Affairs, David Stevenson and David Grabowski of the Harvard Medical School found that larger assisted living facilities (those with 25 beds or more) were far more likely to be located in higher income counties than in poor jurisdictions. 

As a result, low-income seniors who are unable to live at home--perhaps because there may be no one to care for them or because their home may not be suitable for someone with disabilities--have very few options. Many may move to small board-and-care homes--often a room they rent in a local home where assistance is provided by an unlicensed caregiver. Others may get no care at all.  

From the perspctive of the long-term care industry, the Archives paper reflects another troubling trend. Most long-term care in SNFs is paid by Medicaid, and reimbursements for these patients are often lower than the cost of providing care. By contrast, Medicare, which pays for post-acute and rehabilitation services, is far more generous. Medicare typically pays $500 or more per day for these services while Medicaid may pay just $125 for a long-term care bed (these payments vary by state and Medicare payments are adjusted to reflect patient needs).

The result: Growing industry consolidation and an increasing shift away from long-term care and towards more lucrative post-acute services. These choices make perfect economic sense. And they are often praised by advocates for the elderly, who argue that aging services should be provided in the community. However, for some seniors, including some with dementia or those with no family members to help provide care, nursing homes or assisted living facilities may be their only alternatives. Sadly, for many, those options are increasingly unavailable.           

For the second time, President Obama has bowed to conservative critics and backtracked on a plan to allow Medicare to pay physicians for end of life consultations with their patients. He should be ashamed.

In late November, the government adopted new rules that included discussion of advance directives as one of many services physicians could provide during routine annual physicals for their Medicare patients. But The New York Times reported this morning that the White House has now overruled the Department of Health and Human Services and withdrawn the provision.

The decision echoes the decision by the White House and congressional Democrats who dropped a similar provision from the 2010 health reform law in the face of pressure from the political right. During that congressional debate, Sarah Palin and others made the absurd claim that Medicare payments to doctors for discussing advance directives was akin to creating "death panels" where government officials would withhold care from some patients. Democrats were so slow to respond to these charges that even recent polls reported many seniors still believe the death panel canard.

Obama's decision is a tragedy for patients. The rule would have done nothing more than pay doctors for the time they took to discuss advance directives during annual Medicare "wellness visits." Patients could have refused this service if they chose. And nothing in the rule would have in any way constrained end-of-life choices by patients. They could have written living wills however they wanted, or not prepared such a document at all.

The Times quoted new House speaker John Boehner (R-OH) as saying the provision "could be a step down a treacherous path toward government-encouraged euthanasia." Nothing could be further from the truth. In fact, frank talk about end-of-life choices achieves exactly the opposite result. Advance directives give patients more control over medical decisions, not less. It allows them to make their own choices based on  their own moral, ethical, and religious views.  

As a society, we struggle to confront death. Patients struggle, and so do many physicians.  This modest Medicare rule would have provided a small incentive for doctors to take a more active role in helping their patients think about end of life care. And perhaps it might have encouraged better training for those physicians who are not prepared to discuss these issues.

Now, thanks to a toxic mix of conservative ideology, Obama's lack of political courage, and more than a little political cynacism, patients and doctors are left with only confusion and uncertainty. They and their families deserve so much more.          

The Obama Administration has decided to pay doctors for discussing end of the life issues with their Medicare patients. You may recall that this would have been permitted by the 2010 health law, but the provision was dropped in the face of withering criticism by opponents of health reform, who dubbed these important conversations "death panels." 

The new rules are an important first step. Doctors absolutely should be paid for the time it takes to have these difficult conversations. But compensation alone is not nearly enough.

Here's why: Early one morning in a hospital intensive care unit, I was shadowing a care team on their rounds. A patient in her 90s had been admitted from a nursing home with severe breathing problems.She had Stage IV lung cancer and congestive heart failure. A doctor, nurse, and social worker explained to her that she was very ill and gave her two options: They would stop aggressive treatment but make her comfortable. And she would likely die in a day or two. Or they could hook her up to a ventilator. They explained that the device would probably keep her alive for a few months, but also described how uncomfortable she would be.

The woman, who seemed surprised by her prognosis, chose the ventilator. And I could not help but wonder: Why did nobody talk to her about these choices long before this crisis? How could the system have failed her so badly?      

If physicians are going to counsel patients on end-of-life choices, they first need to learn how to talk about these issues with their patients. They not only have to be trained in how to use the right words and body language, many need to fundamentally rethink their own attitudes about treatment and death. Today, too many physicians equate the death of a patient as failure. As a result, they and their patients suffer.

Dr. Dan Sulmasy, who is both a physician and a Franciscan friar, has written powerfully about the intersection of medicine, faith, and death. In one article, he says that doctors "have three great attachments: The need to be in control. The need to be effective. And the need to be right."

Death confounds all three.

But giving patients the information they need to confront the end of life will take more than just retraining doctors. It will also require hospitals, nursing homes, and other health facilities to change they way they approach the dying. For instance, once a patient is admitted to a hospital, it is too easy to become sucked into the powerful and seemingly inexorable cycle of treatment and diagnostic tests. The pressure is always to "do more" and it is reinforced by both a perverse payment system and, often, the demands of family members.

We know how to break that cycle. For example, well-designed palliative care programs can increase the comfort of chronically-ill patients. And while terminally-ill palliative care patients often request less treatment, they also live longer. 

But palliative or hospice care remain an after-thought in too many hospitals. These programs are not given the resources they need. They are not well-integrated into the hospital's practice of care. And attending physicians often wait too long before requesting palliative care consults and then ignore their advice.

Conservative critics are still opposed to these end-of-life dicussions. Robert Pear's New York Times piece that first reported the new rules quoted Elizabeth D. Wickham of a group called LifeTree as saying that end-of-life counseling would encourage patients to forgo or curtail care, thus hastening death. "Patients will lose the ability to control treatments at the end of life," she told The Times.

Of course, Wickham has it exactly backwards. Good physician-patient discussions will give patients more control over their treatment at the end of the life, not less. But only if health providers are fully prepared to have these conversations.  

Last year, the Minnesota Citizen's League asked me to help with a very ambitious project: The group wanted to find ways to improve our broken system of long-term care financing. Earlier this month, the non-profit, non-partisan League came up with its recommendations. I don't agree with them all, but among their far-reaching proposals are some ideas that I hope have legs. 

The League's white paper, called "Moving Beyond Medicaid: Long-Term Care for the Elderly as a Life Quality and Fiscal Imperative" makes three basic recommendations--all aimed at increasing the role of personal responsibility for long-term care while maintaining a safety net for the most needy.

The group would restructure Medicaid, encourage innovative financial products to help families pay for long-term care, and begin a broad education campaign through civic organizations and employers.Their goal is for half of Minnesotans to have some financial planning in place for long-term care by 2015. 

Here is a brief summary of each proposal:

Medicaid: The state/federal insurance program would remain a safety net for the very poor, but middle-class families would be expected to self-finance some of their long-term care costs. While Medicaid would supplement coverage, families would either rely on savings, private long-term care insurance, or home equity to pay their share. They could also buy coverage through the the CLASS Act, the new voluntary national long-term care insurance program that was included in the 2010 health reform law.

New Financing Tools: These include a program to offer prizes to low- and middle-income households who open new savings accounts, a design modeled on an existing program in Michigan. My favorite idea, however, is a new hybrid home equity/reverse mortage product that would provide a low-fee way for people to tap into the equity in their homes for long-term care needs. Today, reverse mortgages can serve that purpose but their fees are too high.

In the League model, Minnesota could create a new low-cost product. I've written about a similar model where the state itself could lend money to those who need long-term care and, get, in return, a lien on the recipient's home. After the person getting care and their spouse died, the loan would be repaid with interest. Such a design would give people broad flexibility in designing their own care, an advantage not available with Medicaid.           

Education: Finally, the League, which has close ties to the local business community, urged companies to play a larger role in encourgaing workers to plan for their long-term care needs.It calls on business to encourage workers to increase both savings and consider home equity or insurance projects to prepare for care in old age. 

This would be a major change. Today, only one in seven workers has access to long-term care insurance through their workplace, according to the SCAN Foundation. And while the CLASS Act is built on workers buying government long-term care insurance through their job, there is little evidence that employers will be willing to offer the coverage as part of their benefit packages.  

The League has built a sturdy foundation for long-term care reform--education, better savings vehicles, and a broad reform of Medicaid. Minnesota's state-funded long-term care program is, like most states, under tremendous financial pressure these days. I hope the state gives some of the League suggestions a try.       

I'm just back from a two day conference sponsored by the Catholic Health Association on ways we can do a better job integrating both medical and personal care for chronically-ill seniors. There may be no more important issue for the delivery of care to this population. If you don't believe me, ask Don Berwick, who runs the Medicare and Medicaid programs for the federal government, Dr. Berwick, the administrator for the Centers for Medicare and Medicaid Services, recently said, "If there is one hallmark, centering idea to achieve better care, better health, and lower cost...it is through integrated care."

CHA asked me to write a paper for this conference and gave me the opportunity to visit providers around the country who are leading the effort to meet this challenge. And the conference allowed about 100 of the nation's top faith-based care providers to get together and exchange ideas. To read my paper, and to see presentations of other participants, go here.   

The idea of integrated care is simple to describe: Ideally, it is a seamless system that provides seniors with medical treatment for chronic and acute disease even as it meets their personal care, social, and spiritual needs. The description may fit on a (long) bumper sticker, but it is not easy to implement. Building such a system requires hospitals, doctors, nursing facilities, home health agencies, assisted living facilities, care managers, families, and communites to work together. And for many reasons, including a perverse payment and regulatory system and the inability of health providers to talk to one another, this rarely happens today.

But some providers are making it work. In researching this paper I learned about projects such as:

The Congregational Health Network: Methodist LeBonheur Health Care in Memphis--a 7 hospital, 1,000-bed system-- is working with 250 churches to improve care for chronically-ill congregants. The keys to this program: hospital-based patient navigators and church-based volunteer liaisons who work together to help patients while they are hospitalized and build a care plan and follow-up after they are discharged.

Schervier Nursing Center's Cardio-Pulmonary Program: Schervier, a Bronx (N.Y.) skilled nursing facility operated by the Bon Secours health system, has dedictated a 39-bed unit to providing sub-acute and post-acute care to patients who have undergone major heart surgery at local hospitals. Rather than recovering in the hospital, where care is extremely expensive and risks of infection and delerium are high for elderly patients, they can recover and undergo rehab at Schervier.

Guided Care at Kaiser Permanente focuses on elderly patients at high-risk of hospitalization. Designed by Dr. Chad Boult at Johns Hopkins University, the Guided Care model is built around an RN who is fully integrated into primary care practices. She visits patients at home, reponds to their telephone calls, and works with families, physicians, and patients to build an easy-to-follow care plan. Kaiser is now deciding whether to make this experimental program a regular part of its healh delivery system.    

Making these creative solutions work today is a huge challenge. But the new health law includes some important incentives, such as accountable care organizations, that mayl encourage more providers to find innovative ways to deliver integrated care.

After spending two days with CHA's health system members, I am optimistic. I was really impressed with their commitment to turn the concept of integrated care into a reality that can both improve the health of chronically ill seniors and be financially sustainable for providers.  

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Senior Obama Administration official Richard Frank says he is "cautiously optimistic" that the Department of Health and Human Services (HHS) can build a viable government sponsored long-term care insurance program under the CLASS Act. CLASS is a national, voluntary long-term care insurance system that was included in the 2010 health reform law.

Frank, a highly respected professor of health policy at Harvard Medical School, is Deputy Assistant Secretary for Policy and Evaluation at HHS. He told a group of long-term care industry representatives, researchers, and elder advocates today that while HHS faces major challenges, the agency can design a workable insurance program under the controversial law, 

Although a deficit reduction commission appointed by Obama recommended last week that CLASS be either repealed or reformed, Frank says he is squarely in the reform camp. And, while he acknowledges it will be a major challenge to create policies that consumers will be willing to buy, he thinks that goal can be reached without changes to the law. CLASS, Richard says, "is designed to change the terms under which we buy and sell long-term supports and services in this country." And, he adds, "it has a great deal of potential."

I agree. But I worry that a real insurance market may never develop under CLASS. The problems are many: CLASS is a voluntary program for both consumers and their employers. The government is barred from refusing coverage to anyone over 18 who works even part-time, no matter what their health status. Anyone who makes more than $1,100 a year is eligible to participate, and low-income workers may buy insurance for only $5-per-month. This arrangement will encourage many working people with disabilities to buy, but also threatens to drive premiums so high that others will be discouraged from purchasing.

Richard acknowledges the problem, and says he assumes initial participation rates will be quite low--likely well below 10 percent. He also says HHS is wrestling with a number of technical issues, such as how to encourage employers to participate in the program, how CLASS will work for those who are also using home care services under Medicaid, how to manage the risk of rapidly-rising long-term care costs, and how to deermine eligibility, especially for those with mental illness. The mentally ill are not usually covered by long-term care insurance but some will be eligible for CLASS benefits.

Making CLASS work will be a huge challenge, but at least today, two years before HHS is due to begin selling policies, Frank still thinks the agency can pull it off. I hope he's right.    

Erskine Bowles and Alan Simpson, the co-chairs of President Obama's deficit reduction commission, have called the CLASS Act "unsustainable" and are proposing that it be either reformed or repealed. They say the national voluntary long-term care insurance program passed as part of this year's health reform law "is viewed by many experts as financially unsound."

The first version of the Bowles-Simpson plan, released last month, was silent about CLASS although sources were warning it was on the panel's radar screen. However, in an effort to win votes from members who have been skeptical about CLASS since it was enacted, the co-chairs added their call to repeal or reform the law in a way that is "credibly sustainable over the long-term."

Unfortunately, the co-chairs dodged the question of how they'd do that. And that was a serious mistake. 

As regular readers of this blog know, I support the concept of CLASS but have argued since before it passed that it needs to be redesigned. The commission chairs provide no clues about how they would do that. Do they support a mandatory program? Would they make technical changes to try to make the insurance more attractive to buyers in a voluntary system? Do they really want to repeal the whole thing?

It is unlikely that the Bowles and Simpson deficit plan will even win the support of their own commission when the panel votes later this week. And if it did, it is hard to imagine Congress ever approving it. However, it is an indication of the mood of Washington these days, and of the discomfort over CLASS in the context of massive ongoing budget deficits. Most dangerous for the program, should Congress ever tackle the deficit, it is hard to see where CLASS would find the support it needed to survive an assault.  

For seniors trying to manage multiple chronic disease, moving from one care setting to another can literally be a matter of life and death. That's why it is so important that health providers--doctors, nursing homes, hospitals, assisted living facilities, and home care agencies--work together to make sure that those moves happen safely.

Too often in our poorly coordinated health and long-term care systems, those transitions fail: Somebody loses track of a medical record, fails to correctly administer an important medicine, or repeats an unnecessary, costly and uncomfortable test. Transitions even within hospitals are notoriously dangerous. When they require cooperation of different providers, the risks are even greater.

Transitional care was the subject of the Gerontological Society of America's annual meeting this week in New Orleans. Just the fact that physicians, social workers, nurses, and academic researchers spent five days talking about this topic was hugely important. It is evidence that the issue is finally getting the attention is deserves.

Even better news: There are transitional care models that both improve patient health and save money. New training programs are making doctors, nurses, and aides aware of the importance of careful transitions and teaching them how to better accomplish them. Other programs work with families to help make them strong advocates for patients during these challenging moves. And models such as those developed by Eric Coleman at the University of Colorado, Mary Naylor at the University of Pennsylvania, and Chad Boult at Johns Hopkins University, have all redesigned the systems we use during transitions.

At the same time, old models are being improved. Palliative care programs do a great job combining medical treatment with social and spiritual care as well as symptom management to improve outcomes for patients. But now they are being better integrated into hospitals and physician practices--a key element to their success.   

On the other hand, it was clear how far we have to go, especially in our wildly inefficient fee-for-service health system. Discharge planning in both hospitals and nursing homes continues to be a broken link in the chain of care. Too often, patients are sent home or to a nursing facility without an appropriate care plan in place. Discharge planners are overworked and ill-prepared, and too often the focus is on a quick discharge rather than a good plan. 

In addition, while many creative experiments are sprouting up all over the country, it was clear from listening to researchers that we have a lot to learn before we know which will work and which will disappoint. 

On December 13 and 14, I'll be participating in an important conference in St. Louis on ways to better integrate care for chronically ill seniors. Sponsored by the Catholic Health Assn., the program will bring together health providers to share successful ideas and help work though some of the financial and medical challenges to better coordinating care.   

It is a tough time to try to sell long-term care insurance.  The private market was stunned on Nov. 11 when MetLife, one of the nation's biggest carriers with insurance on 600,000 lives, announced it would stop selling new policies. At the same time, surveys by two of the nation's most respected long-term care researchers suggest why it will continue to be very difficult both for private companies to sell coverage and for the federal government to succeed in its new national long-term care insurance program--the CLASS Act.

CLASS is the national, voluntary, government-sponsored long-term care insurance program that was passed as part of health reform. It would provide people who need personal assistance with an average minimum daily cash benefit of $50 for life.  

At a conference on Tuesday, Josh Weiner of the research firm RTI International reported that a new survey of potential consumers showed very little interest in a CLASS-like product. The survey, taken in Hawaii last summer, found that 60 percent of respondents said they favored the public insurance program. But only one-fifth thought they'd buy coverage. A quarter said they would not, and more than half didn't know--not surprising for a product that was so new and unfamiliar.

But Josh also asked how much people were willing to pay for coverage. And those responses were far more ominous for the future of the program. Twenty-three percent said they would not enroll. Nearly 60 percent said they'd pay no more than $40 a month, and 17 percent said they'd pay no more than $80. Only 1.5 percent said they'd pay between $80 and $120, and the same number would be willing to spend more than $120.

This is very bad news since most independent analysts figure CLASS premiums will average at least $120-a-month.  It does not mean that only 1.5 percent of potential buyers will purchase, but it shows what a tough selling job the government will have to convince people to buy--a marketing campaign that private insurance has so far failed to pull off for its own long-term care products.

Btw, Josh also asked what people thought of mandating private long-term care insurance--an idea I strongly support. One quarter agreed, 20 percent didn't know, and almost 60 percent opposed the idea. Honestly, I thought it would be worse.

The second survey was done by Marc Cohen of the consulting firm Lifeplans on behalf of the insurance industry. This national survey asked about long-term care insurance in general, not just CLASS

While Marc found that price matters, he also learned that attitudes may be just as important. He concluded that buyers shared several key attributes that non-buyers did not. They were more likely to believe they'd need care at some point in their lives, had a much better idea what it would cost, realized they or their family would have to pay these costs, and were "planners" who felt the need to prepare for future care needs.  His conclusion: People are willing to buy, but only if they perceive value.

The co-chairs of President Obama's bipartisan deficit commision have proposed a far-reaching plan to reduce the nation's massive deficit. It includes big changes for both current and future seniors. Among them: higher Social Security taxes and reforms in the design of benefits, reduced payments to Medicare providers and greater cost sharing by Medicare beneficiaries, and, perhaps most dramatic, a fundamental change in federal payments for Medicaid long-term care.

The chairs, Erskine Bowles--who was chief of staff to President Clinton, and Alan Simpson--a former Republican senator from Wyoming--released their draft plan today. Their proposal still must win the support of 14 of the 18 members of the bipartisan commission, which will be an uphill battle. If the group can reach a consensus, the panel's plan would be presented to Congress in early December.

The Bowles-Simpson plan makes cuts throughout government, including defense and most domestic spending programs. It also includes $750 billion in tax increases over 10 years. While much of what the co-chairs proposed will be hugely controversial, their plan shows what it will take to put the nation back on a firm fiscal footing.

In such an environment, long-term care services can't expect to be immune from cuts. Their biggest proposed change: capping the federal contribution for Medicaid long-term care.

Today, the federal government must automatically pay its share of the cost of these services, no matter how fast they rise. The feds contribute an average of about 60 percent of the cost of Medicaid, although the share varies from state to state. Bowles and Simpson would, for the first time, place a ceiling on the federal match for this joint state/federal program, reducing the federal contribution by about $90 billion from 2012 to 2020.

This would place a tremendous increased burden on states and likely result in both lower payments to nursing homes and home health agencies, and tougher eligibility standards and lower benefits for frail seniors and younger people with disabilities.

No doubt these proposals are harsh, but, like them or not, changes such as these are inevitable. They are a big reason why we must find a way to replace Medicaid long-term care with an insurance program.        

There is lots of quiet speculation in Washington about the fate of the CLASS Act in the wake of the huge Republican 2010 election day victory. Will CLASS be repealed? Will it be changed in any major way?

My best guess is that CLASS--the national voluntary long-term care insurance program passed as part of the 2010 health reform law--will neither be repealed nor fundamentally changed, despite the GOP threat to roll back the entire health law. 

That is not to say conservatives won't try. Activists at the Heritage Foundation and elsewhere have called for repeal of CLASS, which they fear will turn into a new unfunded entitlement program. Sen. Lindsey Graham (R-S.C.) has already introduced a bill to repeal the law.

Worse for CLASS backers, the law has no real advocate in Congress. No Democrat has stepped up to take ownership of the idea since its primary sponsor, the late Sen. Edward Kennedy, died last year. Indeed, about a half-dozen Democratic senators opposed the provision when it was added to the health law.

There is a good chance the soon-to-be GOP-controled House will pass a repeal bill early next year. It would fit with the Republican vow to wipe out the entire health law and their special dislike of federal long-term care insurance. But even with strengthened GOP ranks in the Senate and the support of those Democrats, CLASS opponents remain far short of the 60 votes they'd need to repeal the law. And they''d need even more-- 67 votes-- to override a veto by President Obama. As one insurance lobbyist told me today, "CLASS isn't going to disappear."

Similarly, there is little chance Congress will gut the bill. Unfortunately, the new political environment also makes it extremely unlikely that Congress will improve those elements of CLASS that need to be fixed. As I have written before, there is a real question about how many people will buy CLASS policies, which are likely to cost an average of $100 or more per month.

Some changes in premium design and eligibility could help bring those premiums down. But given the hostility to the law on Capitol Hill, there is no chance the White House will ask Congress to make repairs. Those backers of CLASS who pushed to pass the law, flaws and all, in the expectation that they could fix it down the road are now stuck with the measure, flaws and all.       

After my mother-in-law died suddenly, my wife and I found ourselves caring for my father-in-law. There was so much we didn't know. One area where we were flying blind: We had no idea what financial resources he had, what banks and mutual funds he used, or how to access the funds he needed to pay for his home health aides and, later, assisted living and nursing home care.  

It turns out we were hardly alone. Less than half of adult children say they have ever had a conversation about money with their aging parents. And only 4 in 10 know how much their parents make. Yet, more than 60 percent of these parents think their kids are aware of their financial situation. 

This troubling gap is reported in the Employee Benefit Research Institute's 2010 health confidence study. And it is more evidence that adult children and their elderly parents do a terrible job talking to each other about money. 

There is no doubt that it is awkward. How do you sit down with a parent and say, "So dad, how much money do you have, anyway?" And how often, when adult children try, do parents shut them off with a response that says, in effect, "It's none of your business."

When folks who come to my community programs ask about it, I usually suggest they have this talk when their parents are relatively young and healthy. It is always easier to discuss money--to say nothing of advance directives and other end-of-life issues--before someone is very sick.

It is also easier to make it a two-way street. For instance, adult children can sit down with their parents and first talk about their own planning.

Imgaine starting off a conversation with mom and dad something like this: "We met with our lawyer last week to talk about our own estate plan. We thought it would be a good idea to let you know about our assets and give you a list of our insurance policies and bank accounts. Just in case something happens...."

In that context, it is much less uncomfortable to ask them the same questions. Even if they are unwilling to tell you how much they have, it is critical to know where they keep their funds and, if possible, get a power of attorney that gives you access to their accounts should they be incapable of managing their money. Without those documents, even paying bills on their behalf can turn into a nightmare.

Those of us who are caring for our parents have a huge job. Knowing a bit about their finances can make it a little it easier. But to do that, we need to talk.