California Task Force Plows Ahead With Long-Term Care Insurance Effort

What You Need to Know

The state task force wants to have a proposal ready by Jan. 1, 2023.
Members are talking about a program that would be funded with a combination of public funding and enrollee premiums.
One goal is to avoid the problems that cropped up in Washington state.

A California Department of Insurance panel is trying to develop a new long-term care insurance program — without duplicating the problems that crippled Washington state’s LTCI program launch.

The California Long Term Care Insurance Task Force has been meeting to sketch out a program that could involve a combination of government funding, enrollee premiums and private LTCI coverage.

Task force members hope to deliver a proposal, with a discussion of feasibility, by Jan. 1, 2023, and an actuarial report on the task force recommendations by Jan. 1, 2024.

Contents

What It Means

The Washington Cares Fund program may have had a fatal case of the hiccups, but state lawmakers still want to do something about the baby boomer long-term care cost crisis heading toward their Medicaid programs.

Anyone involved with retirement income planning, retirement health cost planning or long-term care planning needs to participate in professional groups or other organizations that can help them track and influence the changes.

A Long-Term Care Finance Primer

Medicare pays for skilled nursing home care and home health care for people who are seriously ill, or recovering from acute illnesses.

It does not pay for long-term care for people who simply have problems with the activities of daily living or who need supervision because they are coping with dementia.

Medicaid pays for nursing home benefits for people who qualify for state Medicaid nursing home benefits, based on state income and asset limits. In 2013, Medicaid paid about 51% U.S. long-term care bills; Medicare and other public health insurance programs paid 21%; and patients, patients’ families and private insurers paid the remaining 27%.

Private insurers once objected to the idea of Medicaid and other public programs competing with private insurers by paying for long-term care.

In recent years, many insurers have changed course and expressed support for well-designed programs that split long-term care costs between private insurers and public programs.