While not receiving the attention that other parts of the new national health care law have, the Community Living Assistance Services and Supports Act, or CLASS Act could have major implications for areas such as Southwest Pennsylvania that have high numbers of older residents.
In brief, it should work like this: Beginning in 2011, all working adults will have premiums deducted from their paychecks for long-term care insurance unless they opt out. The program is voluntary.
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After five years, an individual becomes eligible for benefits ranging from $50 to more than $100 a day to help pay for care. Individuals must continue to pay the premiums as long as they are working and the benefit kicks in if that person develops a disability, such as paralysis from a stroke or debilitating injuries from a car accident.
The amount received depends on the disability and the extent to which it makes it difficult to perform at least two normal daily activities such as preparing meals, bathing or getting dressed.
There is no lifetime limit and pre-existing conditions will not disqualify anyone, but those already retired are not eligible.
"Right now, if somebody needs community-based services, the only way [he] can get it is through Medicaid or a private payer, which would be prohibitive" due to the expense, said Anne Nalepa, a peer counselor and life skills specialist at Three Rivers Center for Independent Living in Wilkinsburg.
The goal is to help people to remain in their own homes if they choose, or offset at least some of the cost of a nursing home, which she said might charge an average of $200 a day. On the other hand, she added, having an aide come to your home for eight hours a day would be about $115 a day.
The question is, will people participate or opt out?
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The answer will decide the program's success, and The Associated Press reported last week that one independent analysis has forecast that the program has "a very serious risk" of insolvency.
Thomas M. Lilly, of Futurecare Associates in Aspinwall, which specializes in long-term care insurance planning, had a one-word assessment of the program's viability:
"Zilch."
The fear is that young, healthy adults will opt out, figuring they can better use that money for a house down payment or a child's college fund, while those who are older and already have a progressive chronic condition - who require the most extensive and expensive care - will participate.
Mr. Lilly noted that federal employees already have a voluntary long-term care insurance program, but that only about 5 percent have opted in. "People just don't want to deal with the possibility that they may require long-term care," he said. That may be shortsighted.
Mr. Lilly cited research by the Boston College Center for Retirement Research that found that while 31 percent of people will never need long-term care, another 29 percent will need it for up to two years. Twenty percent will require care for two to five years and another 20 percent for at least five years.
In other words, the average person has a 70 percent chance of needing long-term care at some point. But even acknowledging that won't necessarily get people to buy in to the program, Mr. Lilly said.
While many details of the new program are still to be worked out, he has seen early estimates that premiums for opting in will run $140 to $200 per month (other estimates are $85 to $100 per month), but without hope of enjoying any benefits for at least five years.
Those with poverty-level incomes will have greatly reduced premiums but, for many middle-class families, "It's going to be priced out of reach for the people it was intended to benefit."
Making the program mandatory, similar to car insurance, likely would have prevented it from becoming law, he said. He believes that its only real chance was to allow for federal subsidies, but the law forbids that because of cost concerns. Instead, if necessary, premiums will be increased to keep the program solvent.
The program will start off collecting premiums for five years without paying out any claims, building up the fund. Once it starts paying claims, though, "I just don't think it's going to be sustainable," Mr. Lilly said.
One benefit of the program is that it should take some pressure off strapped state Medicaid programs, said Susan Feeney, spokeswoman for the American Health Care Association, which represents long-term and post-acute care providers. Overall, however, "It is yet to be known what the real implications are when it is put into practice."
Ms. Nalepa has used a wheelchair for about six years, due to cerebral palsy, and she maintains a home for herself and her two teenage daughters. She works with about 30 clients, most in their 40s and 50s, who have a range of disabilities from multiple sclerosis, amputations related to diabetes or strokes. Most are now in nursing homes or assisted care facilities.
"They are people who, in their 20s and 30s, would not have expected they would need long-term care," she said. Even people who turn out to be among the lucky 31 percent who never need long-term care, she said, will almost certainly know a relative or close friend who does.
"How can you weigh the difference in quality of life if someone is in a nursing home and doesn't want to be there, or being out in the community in [his] own home?"
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What Health Care Reform Means for Long-Term CareOriginally from: http://www.nursinglink.monster.com/news/articles/12308-what-health-care-reform-means-for-long-term-care
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