Making Progress: Expanding Risk Protection for Long-Term Services and Supports through Private Long-Term Care Insurance

Americans are ill-prepared for many of the consequences of aging and possible disability.  They save too little, they do not prepare emotionally for separation from work, and they are not prepared to absorb the costs of needing long-term services and supports (LTSS) in the event that they experience functional impairments.  This leaves most Americans exposed to the potentially catastrophic costs of LTSS.

Long-Term Care Financing

Public programs such as Medicaid pay for care primarily in institutional settings, and the program is targeted to poor individuals or those who must impoverish themselves trying to pay for such care. Most other Americans can try to save for this potential liability and/ or purchase private long-term care insurance (LTCI), yet few do so. The Patient Protection and Affordable Care Act (ACA) contained provisions for a public insurance program – the CLASS Act –but this program was deemed to be unworkable in its proposed structure and was repealed in the “Fiscal Cliff” legislation.