Category: Aging

The WISH Act: A Proposal for Federal LTSS Insurance for Catastrophic Costs

All members of ASA know that the United States has a wholly inadequate set of “arrangements” for supporting people who need long-term supports and services (LTSS), about half of whom are past retirement age. And they know the situation is on course to become dire within a decade, when so many in the Baby Boomer generation encounter the disabilities associated with aging.

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Potential reforms abound—better pay and benefits for care workers, single point of entry to services, skilled physicians, integrated teams, comprehensive care planning and so on. But all of these reforms will be stymied if there’s no money, and the funding has to be sustained into the future—not just as a short-term fix.

To address this situation, Rep. Tom Suozzi (D-NY) has introduced a remarkable bill, the Well-Being Insurance for Seniors to be at Home (WISH) Act, which would create a social insurance trust fund to cover long periods of LTSS needs, thus making it possible for workers to plan responsibly for the risks of disability in old age.

How the WISH Act Would Benefit Everyone

The WISH Act has a great many good effects: reviving the long-term care insurance industry, reducing the need to spend down to Medicaid, saving state and federal Medicaid programs from dire financial consequences, providing a targeted supplement to Social Security at just the time the beneficiary needs it most, educating Americans about the need to plan for LTSS risks in old age, improving pay and benefits for caregivers, and more.

And it does all of this with a truly modest mandatory insurance contribution from wages—0.3 percent from workers, 0.3 percent from employers. Someone making $50,000 per year, about the median income in the country, would be paying $150 per year, or less than 50 cents per day.

THE WISH ACT REQUIRES A MODEST MANDATORY INSURANCE CONTRIBUTION FROM WAGES—0.3 PERCENT FROM WORKERS, 0.3 PERCENT FROM EMPLOYERS.

The trust fund would be separate from other trust funds and would require 40 quarters (10 years) of having earned the current equivalent of $5,600 per year to qualify for full benefits. Pro-rated benefits start at six quarters. The benefit would be enough to pay for a national average of about six hours of paid caregiving, or about $3,600 per month, paid in cash like Social Security.

To qualify for benefits, the worker must be older than full retirement age and either dependent in two or more Activities of Daily Living or sufficiently cognitively impaired to require nearly full-time supervision and assistance. This is the standard that most long-term care insurance plans use and is ensconced in the HIPAA regulations.

In addition, the person must have had this level of disability for a waiting period that depends upon their earnings record, while contributing to the WISH Trust Fund. Low-wage earners in the lower 40 percent of earnings would only wait one year, and those with higher earnings would add one month for each 1.25 percentiles above the 40th percentile.

For example, the median wage earner would wait 20 months, the 70th percentile person would wait three years, and the highest earners would wait five years. Once begun, the benefit is life-long. This strategy rests on two observations: first, the definition of catastrophic financial burden differs for workers with different opportunities to save, own homes, invest in insurance, and raise families to help; and second, the cost of LTSS does not differ much for poor or wealthy people.

IT IS REALLY THE LONG-RANGE PLAN FOR ELDERCARE FOR US ALL.

The upshot when fully operational is that LTSS would have an infusion of payouts that total around $100 billion per year (in current dollars). The bill includes substantial education about LTSS risks and costs, in addition to the obvious education of having money taken from your paycheck each payday. Many people would learn to plan ahead to protect their ability to manage during disability in old age, without bankrupting their families. Long-term care insurance providers will fill in the waiting period and the additional costs of LTSS beyond the WISH benefit with much more affordable and flexible offerings.

Let’s Not Repeat History, and Instead Take Action on the WISH Act

Many ASA members will remember the push for the CLASS Act, which was part of the Affordable Care Act but could not be implemented because the finances could not work with a voluntary enrollment. The need for something to address LTSS costs has persisted, and WISH is a thoroughly responsible response!

It does not address the urgent needs or the short-term reforms we need in eldercare, and it does not help current retirees or younger people living with disabilities (until their own old age, provided they’ve worked a little over some years, which is true of most persons living with disabilities in working age). It is really the long-range plan for eldercare for us all. If it had been enacted in 1990, we would not be looking at having enormous numbers of elders unable to afford housing, food and medical care within a decade.

Admittedly, we are late to act, but it’s time to stop pretending that we mostly won’t live into old age, or that most of us won’t need LTSS. The opportunity to grow old was still uncommon in the middle of the last century, when Medicare and Medicaid came into being. Having that longevity opportunity now, for most Americans, is a remarkable achievement. But it requires some changes in how we manage to pay for our needs, and the WISH Act would be a major part of that reform.

To get the WISH Act passed will require substantial public interest and support. Call your Congressman and Senator. Explain the importance of this Act. Ask them to co-sponsor. Let’s stop kicking that cursed can down the road!

This post was originally published on July 20, 2021, at https://generations.asaging.org/wish-act-federal-ltss-insurance-ruinous-costs

Fragile Lives and COVID-19 Deaths in Nursing Homes

[Originally published on July 8, 2020]

By Joanne Lynn, MD

A colleague once sent me an obituary notice from a local paper in Arkansas which said, after noting that the 94-year-old woman had gone to live with Jesus, that she “had been troubled in her later years with heart problems and succumbed to the complications of a cold.” How true.  That characterizes how many of us will come to the end of life – we’ll be living with very little reserve and even a small thing will be enough to lead to death.  This is like walking a tightrope and waiting for a stumble or a breeze.  One might manage to keep going for a long time, or one might trip and be gone tomorrow.

The tenuous hold on life that this scenario calls to mind is commonplace among residents in nursing homes.  As an attending physician in nursing homes, I was often perplexed as to how to document a death certificate.  In so many cases, there are so many causes, the conjunction of which is what actually caused the death at this time in this way.  So, of course, COVID-19 will be one of the causes of death for many infected residents in nursing homes, and in many situations, that will be counted as “the” cause of death.

But it is relevant that the person was living in a fragile balance with life before COVID-19.  Life expectancy for nursing home residents varies among facilities and among regions of the country, but the median is mostly under one year.  It is still a loss to the human community to encounter a cause of death some months earlier than would otherwise have happened, but it is worth knowing that the foreshortening of life for nursing home residents is mostly measured in months. Social Security, for example, expects that deaths from COVID-19 will have an almost negligible effect upon their payouts for old age benefits.

The newsworthy tragedy arises with the sudden deaths of a much larger than usual number of residents of a particular facility.  Consider, for example, a nursing home with 240 long-term care residents, where the usual month will have around 20 deaths. In a COVID-19 outbreak in a nursing home that has reasonable staffing and support, it appears that about 20% die with COVID-19 over two months. That would yield 48 COVID-related deaths in that time. Remember, also, that another group of about the same size will have been very sick, whether on-site or in the hospital, which adds to the caregiving and grieving on the part of the staff. So, the situation quickly becomes dire.

However, it is important to consider a statistical perspective on this situation. Assume that this outbreak foreshortened the lives of half of these (and the other half would have died in these two months without COVID-19).  That would mean ½ x 48 = 24 excess deaths over two months. Thus, in two months, the facility would have had:

24 (who died early with COVID-19)

+ 24 (who would have died in about this time frame from their underlying illnesses, but they also had COVID-19)

+ (40-24=16, being those who died without COVID-19 playing a part, which is the background rate minus those attributed to COVID-19 but who would have died in this time frame)

= 64 deaths over two months.

That would be enough to be troubling to the staff and families, and probably to get a hostile story in the local paper.  The judgement is subtly different to realize that 40 deaths were expected before COVID-19.  Over the course of a whole year, the mortality of the residents at the start of 2020 might well be very nearly the same as expected, though 24 died more than a month or two early from COVID-19 infection.

Foreshortening lives by a few months is a real harm and would be better to have been avoided, of course, but it is different from the deaths of people who otherwise were healthy and would have lived for many years. I admit that it is very hard to find the language that acknowledges the pain and loss from deaths of a large number of nursing home residents in a short time while also recognizing that these were somewhat more tolerable than similar numbers of deaths of otherwise healthy people with longer lives ahead of them. Indeed, our culture has a difficult time finding the language or metaphors for death and dying.  Whether one adopts a stance of confidence in the afterlife, gratitude for the necessarily finite gift of life, or fury at that finitude, each of us will die.  Nursing home residents are mostly in a fragile balance with continued life, with multiple organs having little reserve and multiple identifiable chronic conditions.  We need to find a way to acknowledge their nearness to dying without discounting the merits of making the life that is left as meaningful and comfortable as possible.

Consider that the death certificate for the 94-year-old woman who “succumbed to the complications of a cold” will give her cause of death as her heart conditions, even though it was the upper respiratory infection that immediately led to her death.  In the case of COVID-19 affecting nursing home residents, the multiple actual causes of death will often include something like “advanced age with a tendency to a dysfunctional inflammatory response, multiple organ systems with greatly reduced function and no reserves, cognitive dysfunctions that yield self-care disabilities, and a last blow from infection by COVID-19.”  The death certificate and the tally of deaths on the television news will say, “death from COVID-19 infection.” We need to find a way to maintain awareness of the proportion of COVID-19 deaths that afflict persons who were living “in the shadow of death” – while still honoring, valuing, and supporting their opportunities to live.