Predictions-Long-term Care in the Decade

This article first appeared in the June, 2000 CARING magazine

Panel Participants

Question: What will be the major developments in long-term care over the next decade?

The expansion of home and community-based services will continue, fueled by demographic needs, consumer demand, technological advances, and economic effectiveness. Small consoles attached to home TV sets will monitor vital signs, transmit data, provide medication reminders, and serve as emergency response units. Increasingly, patient education and professional care provider interactions will take place using video technology. Paraprofessional home care workers will remain the core of long-term care. Adult day care and group housing options will expand. Hospice will cease to be a separate service and will be mainstreamed into a range of palliative care services.
-Joanne Handy

The trend to provide services in the least restrictive environment will continue, leading to expansion in the menu of services available and a tendency to unbundle services. The assisted-living model will be better defined and more states will provide public subsidies for this level of care. Assisted-living facilities and skilled nursing facilities will increasingly model themselves around single occupancy units. There will be greater diversity in the long-term care workforce, requiring heightened emphasis on staff education. At the same time, technology and robotics may help to lessen the heavy reliance on workers.
-Mary Alice Ryan

Improved technology will help disabled people maintain their independence more easily in the future. They will be able to live more fruitful lives in an environment other than a nursing home. Drug therapy will prevent complications that plague older adults and limit disease progression to the point of disability. The challenge for older adults will be the ability to pay for these designer drugs as more and more third party payors create formularies that exclude these drugs. If the trend continues for increasing drug costs, many of these drugs will be out of reach financially for the majority of older adults. The long-term effect of these new medications may reduce the cost of care significantly, but until that effect is proven over time, third party payors will continue to question their coverage.

The average age of people needing long-term care services will be older than it is today. The long-term care may be provided much more frequently in non-nursing home facilities. Nursing homes in their present configuration will become obsolete and assisted living in a variety of settings will be the norm. Funding for long-term care in non-institutional settings may be increased, but the individual, the insurer, and the government may share in the cost.

Care management will be a covered benefit focused on high-risk, high-cost individuals in the public and private insurance sector. As more payers understand the value of caring for the most costly individuals with chronic disease, the case management model, which states that 20% of people use 80% of services, will be seen for its full worth.
-Joan Quinn

Over the next decade, the key question is: How will long-term care meet the demands for increased consumer choice and improved quality of care while controlling costs and struggling to find the labor supply to provide services? First, with the aging of the population, there will be increasing demand for home and community-based services, including home care, assisted living, adult foster care, and adult day health care. Non-medical residential settings will be increasingly popular, as will consumer-directed care, where individuals hire and fire the workers rather than going through agencies. Second, after the nursing home scandals of the current time, there will be increasing interest in governments trying to play a more aggressive role in monitoring and assuring quality of care in home care. Third, although the financial burden of long-term care in the future is often overstated, it is likely to increase and there will be pressure to control spending. This will run into the labor shortage, which can be solved only by raising salaries.
-Josh Wiener

Question: What will be the respective roles of government, private insurance, and personal resources in the financing of long-term care?

No major expansion of federal long-term care benefits will occur. There will be incremental developments in tax credits, and medical saving accounts for long-term care expenses. States will expand their home care and supportive housing options only as long as the economy is strong. Long-term care insurance will grow as employers offer it as an optional, employee-paid benefit. More and more services will be purchased out of personal resources, as consumers increasingly understand the options available. Retirement planning will stress development of provisions for long-term care.
-Joanne Handy

There will be more pressure for the government to be involved in creative funding for community-based services and for government to have the level of services demanded linked to funds available. Quality will continue to be linked to adequate reimbursement. Federal and state government will need to address funds for housing for persons of limited means if they hope to keep them in the community rather than in institutions. Services to persons with moderate incomes will be more fully developed. The growth of private insurance will be linked to government incentives for corporations to provide this benefit to their employees. All employees will be educated early in their work careers to begin funding of their retirement plans.
-Mary Alice Ryan

A menu of services will be offered and covered using both commercial insurance and government payment, such as Medicare and Medicaid. Additional non-covered services will be paid for by individuals and therefore, the ability to pay will determine the services obtained, not unlike the present environment. Copays will still be required by government and commercial payors. There will not be any program that covers the full cost of benefits. Therefore, it may still be the responsibility of the case manager to coordinate benefits so that the individual will know of all of the programs and payors who may assist with the cost of their care.
-Joan Quinn

Long-term care in the United States is now and will always be overwhelmingly financed by the public sector. It is that way everywhere in the world. Three-quarters of people in nursing homes have their care paid by Medicaid or Medicare; three-quarters of home care expenditures are by public programs. The high cost of long-term care services and the relatively low incomes of 85-year-old disabled widows guarantees a major role for public financing. Personal, out-of-pocket spending has been a declining source of long-term care financing for two decades, even with the improving financial status of the older population. Private insurance will grow, but will remain a niche product. Most studies find that only 10% to 20% of older people can afford private long-term care insurance and that is unlikely to change much over the next decade. If we are serious about long-term care financing reform, and it is not clear that as a nation we are, then we must think harder about what to do with our public programs.
-Josh Wiener

Question: What will be the major challenges in assuring that all people have access to the long-term care of their choice?

The shortage of paraprofessional workers will be one of the major challenges confronting long-term care providers. As the United States looks to overseas labor to ease the shortage, debates will occur about changing US immigration policy. Greater investments in English as a Second Language and skill training will be required. Wages and benefits will increase and providers will continue to struggle with the discrepancy between cost and payment under publicly financed programs. Finding affordable alternatives for the middle class, particularly in long-term home care, assisted living, and adult day care will remain elusive.
-Joanne Handy

The major challenges will be labor supply and funding. The demand for services will continue to outstrip the availability of workers. Economic challenges will include how to fund the same options for all economic levels; the expansion of family financial participation in meeting the needs of older family members; and balancing regulations, financing, and quality. For many people, access to long-term care options will depend on personal savings and long-term care insurance.
-Mary Alice Ryan

The biggest challenges to access will be the availability of home care services in a particular area and the ability to pay for services, especially for the middle class. There is also a lack of knowledge among health care professionals, especially those in institutions, about what options are available for their patients and the cost of the options. Even payors often are unaware of community options for their own beneficiaries.
-Joan Quinn

Although there has always been a two-tiered system that separates those who pay privately from those who rely on Medicaid, there is a danger that the two systems will move further apart as a result of cost pressures in the public system. The 401(k) and stock market millionaires, who are now and will continue to be the minority of the older population, will have whatever they want. The key issue is what will happen to the vast majority of people with much more modest incomes. Inability to finance long-term care is not limited to the low-income population; almost everyone has difficulty. We need to be thinking about moving our financing from one that is dominated by means-tested programs to one that provides universal coverage.
-Josh Wiener

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