Health reform's CLASS Act may help alleviate lack of long-term care planning

California voters, regardless of their political party affiliation or income level, are worried about and feel unprepared for the costs of long-term care, according to a new poll from The SCAN Foundation and the UCLA Center for Health Policy Research.

Fifty-eight percent of registered California voters age 40 and older say they feel unprepared to pay for services if they could no longer care for themselves independently and needed long-term care. Two-thirds say they are worried about long-term care costs, as are 75% of those who are currently providing help to family or friends and 74% of those who anticipate providing help in the near future. Concern also spans all income levels, according to the poll, including 63% of those reporting annual incomes of $75,000 and above.

“Long-term care is one of the greatest challenges in healthcare delivery and insurance for managed care,” says Steven Wallace, associate director of the UCLA Center for Health Policy Research. “On the delivery side, home care and assisted living are increasingly popular as the older population grows in size and the number of available informal caregivers shrinks.”

The poll, conducted by Lake Research Partners and American Viewpoint, surveyed more than 1,200 registered California voters age 40 and older in English and Spanish about long-term care issues. While the poll focused on California, many of the drivers concerning long-term care occur nationwide: an aging population of Baby Boomers coupled with a lack of planning for long-term care.

“There has been private long-term care insurance for many years now, but market penetration is relatively low because of its high cost and the misconception by younger adults that they are not likely to need it,” says Wallace. “Managed care involvement in long-term care has been primarily in the public welfare sector through Medicaid. The challenge for the future will be to identify how to build comprehensive long-term services into risk-sharing private healthcare plans.”

Bruce Chernof, M.D., president and CEO of The SCAN Foundation, says the Class Act, which is part of the reform bill, could provide an additional option if implemented correctly. The Class Act is a voluntary program that could be available as early as next year, but may not be ready until the year after. As part of the Class Act, individuals would make a monthly contribution through their employers or directly if self-employed.

“After five years of contributions, they become vested in long-term care insurance,” Chernof says. “If you were to develop two limitations to daily living, then you would qualify for something between $50 and $75 a day over the rest of your life. That amount is still being determined, and it would not be enough to pay for a nursing home, but it would be in the range of $30,000 a year to help. For example, it could be used for transportation to doctor appointments or home nursing care.”

Chernof says the poll was conducted to raise awareness of the issue because of the quality of care and economic problems that a lack of planning for long-term care will create.

“The crisis of not planning will be that, as boomers age, there will be a significant increase in people over 65 to 85, and without good options, their quality of life and health will be diminished,” he says. “What that means in dollars and cents, is that people will receive care in the acute care system, which of course is the most expensive way to treat. It’s very inefficient and is the wrong place for long-term care. It won't feel like good care to the patients or their families. A lack of planning sets us up for an expensive system that no one really likes.”

Among the poll’s other findings:

• Fifty-seven percent of California voters age 40 and older say they could not afford more than three months of in-home care.
• Sixty-six percent of California voters age 40 and older say they could not afford more than three months of nursing home care at an average cost of $6,000 per month in California, while 42% say they could not afford even one month of care.
• Fifteen percent of those surveyed report having long-term care insurance.
• Twenty percent of those polled were aware that Medicare does not cover ongoing in- home personal care
• Thirty percent knew that Medicare does not cover prolonged nursing home care
• Ninety-five percent of respondents say they prefer having affordable care options in the community in order to avoid going to a nursing home.
• Sixty-six percent believe that ensuring affordable home- and community-based services should be a "high priority" for elected officials, including half or more of Republicans (50%), independents (66%) and Democrats (76%).