Health Insurance: Long-term care

 The Next Big Health Care Reform Fight

What finally kills people -- financially, physically, psychologically, metaphorically -- is trying to figure out how to pay for long-term medical expenses. According to the government, one year of care in a nursing home, based on the 2008 national average, costs over $68,000 for a semi-private room. A year of home care, assuming the need for periodic personal help from a home health aide (the average is about three times a week), costs almost $18,000 a year. While conservatives have been preoccupied with saving Americans from having socialized medicine foisted on them by Commissar Obama, it hasn't completely escaped their attention that an even more nefarious insurance program -- a plan to create public insurance for long-term care that would have the government interceding to prevent citizens in long-term care from being driven bankrupt or crazy by medical bills -- has been sneaking through Congress.

The proposal is known as the CLASS Act, short for Community Living Services and Support. The idea has been around for years, and the late Sen. Edward M. Kennedy (D-Mass.) pushed to have the measure included in the health-care overhaul package that passed the Senate health committee in July. A similar measure was also adopted by voice vote in one of the three House committees handling health care.

This diabolical, morale-destroying scheme would be, get this, "available to anyone, including those who are already disabled." Similarly to Comrade Reid's public option plan for the states, people would be strong-armed into the program automatically, unless, of course, they themselves chose to opt out, and would pay a premium in exchange for insurance against "the cost of home care, adult day programs, assisted living or nursing homes after they had been enrolled for at least five years. Premiums and benefit levels would be set by federal health officials," you know, bureaucrats, "but advocates predict that the program would provide beneficiaries with a minimal sum, around $75 a day" (you do the math).

(Okay, I'll do it: $68,000/yr. comes to a little less than $5,700/mo. $75/day adds up to roughly $2,250/mo. Rounding off generously on both ends, you still end up with a gap of $3,000/mo or $36,000/yr. Considering that the annual median household income is around $50,000 -- and much lower for many seniors and anyone unable to work because they're in need of long-term care, under the best of circumstances the program isn't going to head off a lot bankruptcies).

The proposal has gained momentum in recent days as Democrats in both the House and Senate cast about for cash to help finance a final health package. Because the program would begin taking in premiums immediately but would not start paying benefits until 2016, congressional budget analysts have forecast that it would generate a nearly $60 billion surplus over the next 10 years, cash that would help the larger measure's balance on paper.

Predictably, the usual antis -- "including the Congressional Budget Office and the American Academy of Actuaries," a group I know I rely on for political judgments, especially around Halloween -- have popped up with dire warnings about spiraling costs. Descending into self-parody, Sen. Kent Conrad called the CLASS Act "a Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of," and he vowed to block its inclusion in the Senate bill. As befits a member of the people's house, Rep. Earl Pomeroy, also a Blue Dog Dem, admitted there is a problem that needs addressing, but warned the solution would require some tough decision-making, of which he avowed he is capable, "not some provision cooked up by advocacy groups at the last hour" (see, "idea has been around for years," above).

"It is not a Ponzi scheme," said Larry Minnix, president of the American Association of Homes and Services for the Aging, which represents nonprofit providers and is one of more than 200 consumer and other groups supporting the legislation. "It is a consumer-funded insurance pool that provides people a cash benefit to help with simple chores of daily living so they can remain independent."

Oh, sure. Who're you going to believe, some non-profit consumer activist Little Goody Two-Shoes or a seasoned, tough decision-making legislative adept beefed-up like Popeye on the carloads research spinach trucked in to Washington every day by the insurance industry out of the goodness of their hard little hearts?

The rest of the story: Proposed long-term insurance program raises questions by Lori Montgomery (Washington Post 2009-10-27)