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Resources on Health Reform Client Resource Center Highlights Grassroots Legislative Tools Legislative Tracking Newsletters HUPAC |
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Long Term Care
Long-term care insurance is a means of privately financing long-term care needs, such as extended nursing home care, assisted living facilities, or home care, all of which are usually not covered by Medicare. As the generation of baby boomers ages, an increasingly large number of people will require long-term care, but many have not planned for it, thinking they can leave the financial burden to the government. Yet, as government-funded medical expenses continue to rise, programs such as Medicaid and Medicare face funding crises. Long-Term Care insurance will continue to grow in importance and popularity in order to combat the rising costs of government-sponsored health care.
NAHU's Position
NAHU believes that consumers should be encouraged to purchase the long-term care policy of their choice. Federal long-term care purchasing incentives are necessary to reduce Medicaid spending and provide Americans with the ability to afford such care when it is necessitated by medical circumstances. Purchasing incentives such as making long-term care insurance available through Section 125 cafeteria plans and above-the-line tax deductions for long-term care premiums are strongly supported by NAHU. Consumers should also be made aware of any potential tax consequences of policies. The aging baby boomers will require long-term care in an increasing number; these individuals will be best served and the government's burden will be minimized if the purchase of private long-term care insurance policies is encouraged by public policy and tax policy.
NAHU's Action
Federal Involvement
State Involvement
Industry Involvement
NAHU's long-term care working group is actively working to educate lawmakers and the public about the importance of private long-term care insurance. Some of the resource materials NAHU has developed on this topic include:
- NAHU Position on Long-Term Care Insurance
- State-Level Long-Term Care Tax Incentive Legislation - Part 1 | Part 2
- Laws Related to Long-Term Care Insurance
Legislative Action
Long-term care provisions were included in the health reform bill signed by President Obama into law March 23, 2010, the Patient Protection and Affordability Care Act, (PPACA), P.L. 111-148. Significantly, it created a public insurance option called the Community Living Services and Supports or more commonly, CLASS Act. It will be funded by premiums and would pay enrollees at least $50 or more per day if they became too disabled to perform normal daily activities like eating and bathing. Employers who chose to participate would sign up their employees, who would then have the ability to opt out. The cash benefits could be applied to nursing-home care, but in an effort to encourage enrollees to stay in their own homes, payouts could cover such things as wheelchair ramps and wages for home health care aides.
For more information on the CLASS Act see this issue brief.
Current Federal Law
In 1996, through provisions contained in the Health Insurance Portability and Accountability Act (HIPAA), Congress made a portion of certain types of long-term care insurance premiums tax deductible.
| Age | Maximum Deductible Limit | |
| 2009 | 2010 | |
| Under 40 | $320 | $330 |
| 41 to 50 | $600 | $620 |
| 51 to 60 | $1,190 | $1,230 |
| 61 to 70 | $3,180 | $3,290 |
| Over 70 | $3,980 | $4,110 |
Additional Resources
Independent Review for LTCI: Too Little, Too Late? This article by Claude Thau, originally published in the February 2009 issue of HUI magazine, discusses the potential for long-term care insurance providers to earn the trust of the American public. LTC Advisory Group Click here for group members and their contact information.New LTCi Buyer and Non-buyer Study
“Own Your Future”—The Long-Term Care Awareness Campaign Demonstration Project sponsored by the U.S. Department of Health and Human Services, the National Governors Association and the National Conference of State Legislatures
Study of Nursing Home and Home Care Costs: Does Long-Term Care Insurance Make a Difference? - Sponsored by MetLife (September 2004)
2004 Index of the Long-Term Care Uninsured - LTC Financing Strategy Group (April 28, 2004)
A Shopper's Guide to Long-Term Care Insurance - National Association of Insurance Commissioners
GAO Report: Medicaid Home and Community Services for the Elderly Individuals Varies Considerably
Tax Deductibility of Long-Term Care Insurance Premiums: Implications for Market Growth and Public LTC Expenditures Marc A. Cohen, Ph.D. and Maurice Weinrobe, Ph.D. March 2000.
Federal Long-Term Care Insurance Program Website - U.S. Office of Personnel Management
Center for Long-Term Care Financing
General Information on Insurance for Seniors—Prepared by SeniorResource.com
Home Health Quality Initiative (Centers for Medicare & Medicaid Services) - For the first time, home health quality measures are available to consumers to help them choose a home health agency. Home Health Quality Measures are now available for home health agencies nationwide.
Testimonies
Medicaid Testimonies.For more information, please contact John Greene.
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