The following research paper will focus on the Long Term Care Sector which is part of the health care delivery system. It will look at the historical development of the sectors and the challenges and issues facing it prior to health care reform. It will also look at the specific challenges in the sector, and the benefits and risks it faces in the future associated with health care reform. Despite the US having one of the best medical care services in the world, it is only accessible to those who have health insurance plans or resources. It is has not been universally accessible to all American citizens. The Affordable Care Act ensures that all Americans have access to affordable health care. Current health reform has focused on the key issues of those who are uninsured, and has not looked critically at long term care especially for the future.
Long term care users fall into two categories; the frailed elderly and the disabled. The long term care sector is a crisis in the horizon as the 77 million baby boomers enter retirement. The number of people requiring long term care in future will increase including the non-elderly persons with disabilities. Policy makers need to look at the key issues affecting the sector in order to come up with health reforms that will assist avert the crisis that will happen with long term care in the next 30-40 years. The costs of long term care are high and the existing systems do not have clear mechanisms for payment and delivery.
Historical Development and Current State of Long Term Care Health Care Delivery
In order to understand the historical development and current state of long term care in health care delivery one must look at the US Health Care Delivery system as a whole. The Health Care Delivery system consists of major components and processes that enable people to receive health care. Most developed countries have a National Health Insurance programs that enables all citizens to receive health care services. However, in the US not all citizens are entitled to routine and basic health care services. Despite the US Health Care Delivery System having evolved, there are concerns on access, cost, and quality as the system does not provide a universal basic health care package at an affordable cost. Organizations, individuals involved in health care include educational and research institutions, medical insurers, suppliers, claim processors, and health care providers.
The US health care delivery system has various subsystems that include managed care, military medical care system that caters for vulnerable populations, and the integrated system that consist of various forms of ownership between hospitals, physicians, and health insurers. Long term care is normally provided through managed care. Long term care is any arrangement where a Medicaid program contracts an organization to provide benefits which will include some level of long term care benefits.
The following are the main characteristics of the US Health Care System. The system has no central governing agency, and has little integration and coordination. The health care costs under the system are high and there is unequal access. Legal risks influence practice behaviors, and there is conflict through the health care system in terms of market justice vs. social justice. The access to health care under this system is selectively based on insurance coverage. There is a quest for integration and accountability. The US expenditure on primary health care is the highest in comparison with other developed countries and is almost 13% of the Gross Domestic Product.
The US has a unique Health Care system, but it lacks universal access to all American Citizens. Health care in the US is compromised by disintegration in delivery limited access and high costs. The two groups of patients that suffer under this system are those with complex long term care needs and those with low income or no health insurance. Access is restricted to those who have health insurance through their employer; those covered under a government health care program; those who can afford to buy health insurance using their own funds; and those who are able to pay for services with their own funds. In most developed countries the Government plays a central role in the provision of health care to its citizens. In the US this is different where the private sector plays a leading role.
In 2003, managed long term care market was expected to grow dramatically. However, only 2.3% of this market using public long term care is receiving these services. Managed long term care is provided mainly through large local non- profit plans or those that have progressed due to responses from particular states. The growth of long term care services has been very slow due to several factors. These include complex programs that take a relatively long time to plan, startup periods, and resistance of long term care providers, federal policies, and inadequate infrastructure. However, despite these challenges long term care is popular in the states where it is well established and has the potential to grow in the future (Fronstin, 2010).
In the 1970’s long term care services was mainly through nursing homes. This brought about large increases in nursing home expenditures and raised the issue of whether the long terms services system was sustainable. In the 1980’s there was the introduction of home and community based waiver (HSBC) so that states would create flexible community based services. The HSBC waiver program grew rapidly, however the nursing home expenditures continued to increase. This meant that the HSBC waiver could not control the growth of institutional care.
In the 1990’s several states planned initiatives on long term care based on Medicaid managed care. Different states had different legislation on long term care. In 2003, 3.1 million elderly persons and persons with disabilities received long term care through Medicaid financed long term care. Of these, over half a million were in nursing homes and half a million went through community based waiver services program. Examples of managed long term care programs include Arizona’s Long Term Care System, Florida’s Frail Older Option, and San Francisco’s On Lok Program. Minnesota, Colorado, and Wisconsin are among the leading states providing innovative models on long term care.
Challenges and Issues Prior to Health Care Reform
The major challenges and issues facing long term care prior to health care reform relates to access, cost and quality. Prior to health care reform, states had showed interest in using managed care models to purchase Medicaid benefits for those populations that required long term care. In developing these programs, States needed businesses that had managed care plus expertise in clinical, social management of long term care populations. Traditional health plans prior to health care reform did not have this expertise. On the other hand, those that had expertise to provide services for long term care did not have any experience in managed care. For the long term care market to succeed, it required the merging of managed care expertise with experience in long term care populations. Due to this the managed care institutions expanded into long term care or long term care institutions expanded into managed care. The market before health care reform was dominated by long term care businesses expanding into managed care (Baer & O’Brien 2010).
The role of the aging network advocates was another challenge facing long term care. Advocacy from aging networks has a huge impact on various long term care programs. For example, the aging network advocates were opposed to long term care reforms based on partnership models that involved integration of acute and long term care. This was because such plans would be dominated by medical HMO’s thus reducing the role of the aging network.
The other challenge is that there are not many private long term care businesses to offer long term care to the aging populations. Prior to health care reform law, there were two major for profit players in the long term care market; Amerigroup and Evercare which is the leading player. Evercare has long term investment plan and it targets frail elders and all persons with disabilities. The company is working across the country and is also active at federal and state levels. Amerigroup on the other hand is Evercare’s major competitor, but long term care is not its core business. Most providers of long term care have developed a managed care service (Fronstin, 2010).
Another challenge is whether managed long term care can offer more value in comparison to HCBS services. HCBS or fee for service programs depend on the case manager who coordinates the long term care. Managed long term care increase the use of home and community based services, and reduces the use of institutional services. They also have high customer satisfaction levels. In addition preventable admissions and high death rates are not a concern.
Policy issues and complex program designs are a challenge to managed long term care. The managed long term care programs that have been implemented are very diverse across different states. Differences exist in payment methods, managed care suppliers, competition, and whether enrollment is mandatory or voluntary. Most states do not have a clear picture of which program models they should replicate. However, Arizona stands out as one of the most successful long term care programs (Grabowski, 2006).
Legal authority over managed long term care has advanced positively, however difficult policy issues often emerge that complicate program development. Payment challenges will always remain controversial and technical for most managed long term care programs. These need to be refined in the future. Constituents are concerned about political resistance to managed long term care from the established fee for service systems. Infrastructure is a challenge which affects access, and it is does not exist in some states where the target population for long term care lives. Managed long term care was in its infant stages prior to health care reform, where only 3% of the potential market has enrolled in managed long term care plans.
Challenges in the Long Term Care Sector
The biggest challenge that the long term care sector will face in the future is that baby boomers are set to retire and the number of citizens seeking long term care will increase. In addition new technology and medical advances are increasing life longevity. It is estimated that there are about 77 million baby boomers. Most of this population prefers to receive medical care from home or their community and not in nursing home. Very few of them have prepared for long term care either through insurance or savings. Majority of the baby boomers have fewer children and will most likely be divorced. It is therefore unlikely that they can have family to informally take care of them (Johnson, & Wiener, 2006)
Currently health care reform laws and associated regulations are concerned with the populations that are uninsured and the rising health care costs. However, long term care need to be considered as it may soon become a crisis in the future. Many elderly people live in fear that chronic diseases will drain them financially. This aging population may have to depend on their children or welfare, and this will limit how they want to live at the end of their lives. Long term care will soon become the issue after the health reforms on acute health care systems.
Policy makers need to reform the health care system to ensure that this aging population can access affordable long term care in the future. The current system does not meet the demands of the frail and elderly who require assistance in normal daily life tasks such as bathing, toileting, dressing, cooking, transportation, housekeeping, and managing finances. Long term care is expensive and the cost will continue to rise in future. Long term care is currently funded through Medicaid and Medicare (63%), with out of pocket expenses covering 22%, and the remaining 15% from private sources. Medicaid covers long term care, but Medicare only covers some level of long term care for short durations after hospitalization. Most of the people approaching retirement are unaware of this fact (Johnson, & Wiener, 2006).
Private financing of long term care is through long term care insurance. Currently about 8 million Americans have some form of long term care insurance. These policies vary as long term care insurance is a relatively new product in the health insurance market. Cases of difficulty in getting long term care benefits under some of these policies have been reported. The market for long term insurance is small because families, who can afford to but it earlier in life, do not because they are in denial about ending up in a nursing home when they retire. Other families do not have the necessary information to make a decision and sometimes they do not understand the insurance technical language. High premiums is also another factor that deters families from purchasing long term care insurance (Baer & O’Brien 2010).
As the baby boom generation approach retirement, most of them do not have financial plans for their retirement. This leaves them with insufficient savings to take care of their expenses in retirement. The average nursing home costs about $ 80,000 a year, whereas some of this generation end up with about $70-75,000 in savings when they retire. Additional policy effort is required to deal with the challenges that the long term care sector will face in future. Medicaid and Medicare are already facing huge financial strains due to high health care costs and an increase in demand for services (Calmus, 2013).
Potential Risks and Benefits
As discussed earlier the number of people requiring long term care will increase as baby boomers grow older and the number of non-elderly persons with disabilities increase. The Patient Protection and Affordable Care Act also known as the ACA or Obama care makes long term care services more affordable and protects the rights of consumers. All citizens are entitled to health care until they retire. The law ensures that people can receive long term care services and support in their homes or community. It provides existing tools, new options and financial incentives for States to provide home and community based services. The aging population will have increased access to health care and the law will ensure quality of service (Gruber, 2011).
The health care reform provides enhance federal funding to states for the provision of person centered and home and community based attendant services. This will increase the ability of individuals with disabilities to live within their community. The law increases access to non-institutional long term services support (LTSS). The Money Follows the Person (MFP) was extended under the law for a further five years. The MFP allows for individuals who are provided with long term care to move out of institutions into their homes and other community based environments. In the area of quality, the law provide for a grant program (TEFT), demo grant for testing experience and functional assessment to test quality measurement tools and ensure quality of long term care services (Gruber, 2011).
The possible risks to long term care associated with health care reform are that the current health reform laws have not critically looked at the future. Long-term care should be part of efforts to improve health care for all Americans. It is believed that long term care affects only a small percentage of the population. 70 percent of people turning age 65 will need long-term care as they age, and about 33% will spend some time in a nursing home (Wiener, 2009)
There are four critical factors that need to be considered when looking at the possible risks for long term care associated with health care reform. The first one is that the aging population and people with disabilities is going to grow dramatically in the future. The financial burden for long term care will be much greater than before. Health reforms need to consider how this part of the population will access long term care. Reforms need to consider the demographics or characteristics of the people who will require long term are in future as this is very different from those receiving long term care today (Wiener, 2009).
Secondly, federal and state governments are spending huge amounts of money on long term care. Public spending on long term care will increase substantially in the next 20-30 years. Long term care is one of the health sectors that is dependent on public funding. Thirdly, most of the older people with disabilities also incur high acute care expenses as these are related to their underlying chronic diseases. Fourthly, the current health care system under the existing reform laws does not have a proper financing and delivery system. There are no proper mechanisms in place to help people plan and pay for long term care as they grow older (Calmus, 2013).
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