The time is right for state policymakers to adopt policy and regulatory approaches to support the retention of benefit value in long-term care insurance policies. Doing so would help protect the financial resources of individuals and Medicaid.
That’s the conclusion of an analysis by ATI Advisory, a research and advisory services firm, and the LeadingAge LTSS Center @UMass Boston that has the support of the Anthem Public Policy Institute.
Data on private long-term care insurance policyholders who purchased policies between 1995 and 2005 were analyzed to understand national and state-level in force policy value, buyer demographics and the likelihood of buyers’ Medicaid eligibility in absence of their long-term care insurance policy.
“It is important that these policy values be protected because they represent significant private pay dollars to support the [long-term services and supports] service infrastructure when people become functionally impaired and need to access LTSS services,” lead researcher and LTSS Center Co-Director Marc Cohen told the McKnight’s Home Care Daily.
Cohen estimated that among individuals who bought policies between 1995 and 2005, almost $800 billion in benefit value is available to pay for LTSS expenses. “To put this in context, in 2016, the Medicaid program spent just over $100B annually on LTSS for older adults and individuals with physical disabilities,” he said.
“Like so many things, COVID-19 heightens the need for intense focus on addressing our regulatory system’s ability to ensure that policyholders retain as much private long-term care insurance benefit value as possible,” ATI Advisor CEO Anne Tumlinson said. “As this study shows, there’s too much money on the table to let it slip and too much at stake both for individuals and the largest public payer of care – Medicaid.”