Deficit Reduction Act Impacts - Mapping a Diverse and ...DRA Benchmark Benefit Impact Overview LTC Providers Constituents States Negative Postive As benefit packages and provider networks
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Avalere Health LLC | The intersection of business strategy and public policy
Deficit Reduction Act Impacts -Mapping a Diverse and Shifting Landscape
State Legislators face a dizzying array of issues related to long term care and long term care populations – people with disabilities of all ages and seniors.
» These policy challenges compete with other pressing issues such as budgeting, education, terrorism, and pandemic concerns.
Provide a cogent overview of the Deficit Reduction Act of 2006 (DRA) implications for states, Legislators’ constituents, and the long term
Incidence of disability and higher levels of acuity increase with age; only old-old will likely need NH care
Most significant population growth will be in lower age brackets who will have less intense service needs
Regarding the 85 and older group, while growing rapidly from 2020 – 2050, it is unclear whether this will lead to a significant increase in the need for traditional nursing home services
Bridge Period (2005 – 2015)
Demand Spike (2016 – 2050)
Possible NH Users
Demography and Demand Are Not So Clear Cut
Source: Avalere analysis of U.S. Census Bureau data.
Long-term care hospitalsInpatient rehabilitationSkilled nursing facilityHome health
Sector is Small, but Attracts Focus on Medicare Growth
Note: These numbers are program spending only, and do not include beneficiary copays.*EstimatesSource: Centers for Medicare and Medicaid Services, Office of the Actuary.
» What sorts of beneficiary protections does our state provide to private LTC insurance purchasers?
» What sorts of tax incentives could we offer to encourage purchase?
» Have we considered strategies to make private insurance – under this option -- affordable for low income populations who could easily and quickly spend down to Medicaid?
For LTC Providers, Public Payment Systems will Remain the Cornerstone
Key drivers
» Private long term care insurance market is immature and limited
» Reverse mortgages are useful to only a very small group of people
» Retirement planning is minimal
» Employers are likely to continue retracting retirement benefits
» People do not understand long term care or their options
» Family care giving capacity is likely to decline as the population ages
State and federal policies and programming are addressing some of these items but actual impact on private financing and planning has been limited and will remain so in the next five years
Bottom line: Will public reimbursement attract sufficient numbers of providers?
How can Legislators strengthen the spectrum of long term care services and be responsive to consumer preferences?
What specific policies Legislators should develop and promote to make Medicaid more sustainable?
» How can long term care strategies be better integrated with other critical services -- including acute care services, disease management and preventative services (such as Older Americans Act programs) – to create an array of Medicaid “diversion” tools?
What strategies should Legislators employ to balance efforts aimed at slowing Medicaid spending while providing -- and encouraging use of -- affordable alternatives?