AHIP Testifies on Long Term Care Issues

Long Term Care Insurance Reform

Karen Ignagni, President and CEO of America's Health Insurance Plans (AHIP), today testified before the House Energy and Commerce Subcommittee on Health on identifying solutions for the nation's current and future long term care (LTC) needs. She emphasized that our nation needs to explore public-private partnerships that could make long term care costs more predictable while expanding care options for consumers.

"What we are seeing today is an imbalance between the reality of long-term care needs in America and the continued focus on acute care," Ignagni said. "Our nation needs to focus more on the continuum of care given our aging population and its diverse needs," she continued. "LTC insurance and a series of meaningful changes in Medicaid can provide the basis for a true public- private partnership in assuring that baby boomers and others have access to the care they need when they need it."

In her testimony, Ignagni provided an overview of private long term care insurance, discussing the piece of mind it offers to consumers and the cost savings that can accrue to Medicare and Medicaid. Additionally, she pointed to the innovative strategies that health insurance plans are employing today to provide high-quality services to Medicaid beneficiaries, while also containing costs. She also stressed the importance of moving forward expeditiously to implement the newly expanded long term care partnership programs in all states

"Recent Congressional action on expanding the long term care partnership programs is a major step toward our nation's long term care readiness," she said. "We look forward to working with states and the federal government in bringing new products to market as soon as possible to help ameliorate cost pressures on public programs, and, at the same time, continuing the innovative and effective strategies our members are bringing to beneficiaries eligible for both Medicare and Medicaid."

Ignagni also made several recommendations for additional policy changes that should be pursued to help more Americans secure protection against long term care costs:

• Instituting an Above-the-Line Federal Income Tax Deduction for LTC Insurance Premiums that would allow taxpayers to claim a tax deduction regardless of whether they itemize their deductions and regardless of whether they have other medical expenses. For example, a person who pays $1,500 in premiums for long-term care insurance could reduce his or her taxable income by the full $1,500 under this proposal.

• Permit the offering of LTC Insurance Under Cafeteria/FSA Options allowing employers to offer LTC insurance as an option under cafeteria plans and flexible spending arrangements (FSAs), thereby giving working Americans an opportunity to address their future LTC needs through their existing employee benefit arrangements.

• Removing Barriers to Medicaid Managed Care such as the rules regarding the federal upper payment limit (UPL) program that have proven to be a barrier to expanding Medicaid managed care to beneficiaries because the services provided to health plan members by publicly owned facilities are not counted in determining the UPL payment. This creates financial disincentive for states to meet beneficiary needs through Medicaid health plan programs - despite their proven ability to improve health care for the most vulnerable members of the Medicaid population.

• Exploring Best Practices and Demonstrations that will provide additional help to the LTC population, including working through Medicaid to maximize beneficiary independence and the opportunity to seek care within their homes and communities; promote models of coordinated, multi-disciplinary, continuous care and support across all settings and throughout the life spans (in contrast to a model of intermittent, episodic care); and emphasize prevention for patients (risk assessment, early identification and intervention).

• Creating a Presidential Commission to Address the Nation's Long-Term Care Needs that would make recommendations to Congress and the Administration for accomplishing a wide range of goals including exploring how to create a seamless long-term care continuum from acute to chronic care; exploring tax incentives to encourage individuals to take planning responsibility for their own long-term care needs; exploring how to redesign Medicaid to allow dollars to follow the person across all settings, ensuring that access to quality long-term care and services can be received in the settings of choice; and exploring the potential to increase utilization of technology (telehealth, monitoring devices, electronic medical records, etc.) in all care settings - particularly in rural settings.

• Establishing a Federal Office to Address Long-Term Care Workforce Issues to address professional and paraprofessional long-term care workforce issues and provide recommendations to improve the recruitment, training, retention and practice of a strong long-term care workforce.

• Establishing a Quality Agenda for Long-Term Care including measurement and reporting across the continuum of services and settings, and performance-based payment, taking into account consumer satisfaction, health literacy, and progress in addressing disparities. Recognizing the efforts underway by the Ambulatory Care Quality Alliance (AQA), the Hospital Quality Alliance (HQA), and the Pharmacy Quality Alliance (PQA), a similar public-private collaboration is needed to address quality challenges in long-term care settings.

America's Health Insurance Plans - Providing Health Benefits to More Than 200 Million Americans: http://www.ahip.org/