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									Long-Term Care Partnership:
Protecting Consumers and States
from Catastrophic Expenditures

State Coverage Initiatives Winter Meeting
February 8, 2008
Chad Shearer
Program Officer, CHCS
About CHCS


Our Mission
  To improve health care quality for low-income children and adults,
  people with chronic illnesses and disabilities, frail elders, and
  racially and ethnically diverse populations experiencing disparities
  in care.
     Our Priorities
      Advancing Health Care Quality and Cost-Effectiveness
      Reducing Racial and Ethnic Disparities
      Integrating Care for People with Complex and Special Needs

                Our National Reach
               48 states
               160+ health plans
Background


• Aging boomers                           National Spending on Nursing Home Care,

• High probability of needing                   By Source of Payment (2005)
                                                     Total = $122 Billion
  nursing home services                    Other Public
                                           Funds, 2.7%
• High cost of long-term care                                                           Out of Pocket
                                                                                         Payments,
  services                                                                                 26.5%
                                  Medicaid,
• Medicaid:                        43.9%
                                                                                      Private Health

   – Largest payer for nursing                                                          Insurance,
                                                                                           7.5%
     home services                                                                       Other Private
                                                                             Medicare, Funds, 3.7%
   – Long-term care is                                                        15.7%

     substantial portion of
                                 Source: Centers for Medicare & Medicaid Services (CMS), National Health Expenditures



     Medicaid spending
LTC Partnership History



• Robert Wood Johnson Foundation (Late 1980s)
  – States and insurers collaborate on long-term
    care insurance product for those who might
    otherwise rely on Medicaid to finance LTC.
• Four states implement programs (Early 1990s)
  – California, Indiana, New York, Connecticut
• Moratorium on new Partnership programs (1993)
  – 4 original states allowed to continue
Partnership Benefits


• Asset Protection – If Partnership policies do not
  sufficiently cover the cost of LTC, beneficiaries may
  qualify for Medicaid while retaining a level of assets
  that would otherwise preclude them from eligibility.
  – Attract middle-income consumers who might not
    otherwise purchase LTC insurance.
• Medicaid budget protection – GAO reported mixed
  results but original states and growth suggest budget
  benefit.
  – Only a small portion of policy holders exhaust their
    private benefits
Partnership Resurgence


• Deficit Reduction Act (DRA) of 2005
  – Eliminated moratorium on Partnerships
• Rules for new Partnerships
  – Approved Medicaid State Plan Amendment (SPA)
  – Consumer Protections – NAIC Model Act & Regulations
  – Asset Protection – Dollar for dollar protection
  – Inflation Protection – Depending on age of purchaser
• Original Partnership states deemed to have satisfied new
  requirements
Partnership Expansion
CHCS/RWJF Initiative


 • Long Term Care Partnership Expansion
   – Seed funding to 10 states developing partnership
     programs:
      • Arkansas, Colorado, Georgia, Michigan,
        Minnesota, Ohio, Oklahoma, South Dakota,
        Texas, Virginia
      • 3 states operational, 3 with approved SPAs
   – Technical Assistance
   – Policy Briefs
   – In-Person Meetings
Partnership Issues


 • States implementing or considering partnerships must
   consider:
   – Inflation protection
   – Agent Training
   – Policy Exchange
   – Reciprocity
   – Reporting Requirements
   – Medicaid Eligibility Determinations
   – Cost Effectiveness
   – Outreach
Contact/Resources


 CHCS – www.chcs.org – (609) 528-8400
  Chad Shearer – cshearer@chcs.org
  Joanie Rothstein – jrothstein@chcs.org

 • Long Term Care Partnership Program Technical Assistance Website -
   http://www.dehpg.net/LTCPartnership/
 • Centers for Medicare & Medicaid Services (CMS) -
   http://www.cms.hhs.gov/DeficitReductionAct/09_LTCPartnerships.asp
 • National Association of Insurance Commissioners (NAIC) – www.naic.org
 • Long Term Care Group, Inc. - http://www.ltcg.com
 • Provider Groups Financing Reform Agenda -
   http://www.aqnhc.org/email/20080115_2.html

								
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