One of the biggest misconceptions many have about Medicare is that it will cover their potential long term care needs. While Medicare may provide some coverage for this type of care, there are significant limitations. As a result, most people who need long term care will still be forced to pay for it out of pocket, or through Medicaid or a private long term care insurance policy.
If Medicare were to add a true long term care benefit, what would it look like and how would it work? A proposal recently published by Health Affairs presents several interesting ideas on how to integrate a long term care benefit into the existing Medicare framework.
In-home care – The core of the proposal is built around an in-home health care benefit that would be available to anyone with dementia or who cannot perform two of the Activities of Daily Living on their own. There would be a daily benefit limit, similar to private long term care insurance. The focus on in-home health care keeps with the growing trend towards “aging in place”, which allows seniors to continue to live at home as independently as possible even as they need additional supportive services.
Integration and coordination of care – Beneficiaries would be encouraged to enroll in what the proposal calls an Integrated Care Organization. These ICOs would coordinate care between doctors, long term care providers, and unpaid care givers like loved ones to ensure that patients receive all the medical and support services they need.
One of the obvious challenges to adding long term care benefits to Medicare is the associated cost to an already strapped system. Aside from a relatively modest monthly premium and a moderate increase in the existing payroll tax that goes to fund Medicare, a significant portion of the cost would be covered by sliding scale co-insurance. The co-insurance would range from 5% for the lowest income beneficiaries to 50% for those with the highest incomes. This would be especially significant for middle income seniors who currently have too much in assets and income to qualify for Medicaid, but cannot comfortably afford the full cost of long term care.
While it may not be a perfect proposal, it does start a necessary conversation on the real struggles of many seniors to receive the long term supports they need to live their later years with comfort and dignity.