National Call Presentation on Long Term Care

By Henry Moss, PhD for Health Over Profit, Feb. 5, 2018 A free pdf of Dr. Moss’ book is available on the website.

En Español

In this talk, I’d like to paint a picture of a caregiving crisis that will hit the U.S. full force around 2030, with peak effects lasting through 2050.  As I do this, I think the nature of long-term care policy and practice in the U.S. will become clear.  We will also perhaps get a glimpse of some of the reasons why Senator Sanders did not include long-term care in his legislation, despite its presence in HR 676. I will also explain why I think that was a bad decision, politically, and in terms of health care policy, following upon a recent HOPE presentation on this subject.

What is long-term care?

We should start by defining long-term care since it often means different things to different people and agencies. For our purposes, long-term care is the personal, custodial care we need when chronic illness, physical disability, cognitive impairment, mental illness, or frailty make us unable to carry out our normal activities of daily living (ADLs). Basic ADLs include toileting, grooming, dressing, bathing, feeding, transfer (e.g., into and out of bed), and moving about. Instrumental ADLs (IADLs) include shopping, banking/personal finances, cooking, travel, and general housekeeping.

This definition includes the monitoring and “cueing” provided to those who can technically perform ADLs, but who suffer from dementia or other conditions involving disturbed behavior, putting themselves and others at risk.

Personal care is provided in nursing homes, mental health institutions, and intermediate care facilities including those serving individuals with intellectual or developmental disabilities.

It is also increasingly provided by personal care aides or home attendants in private homes and in settings such as assisted living facilities, senior residences, group homes, and adult day care centers.

Long-term care may also include assistive technology, minor home modifications, transportation, and the occupational training and employment, and education support services needed by younger adults with disabilities.

Medicaid is responsible for the large bulk of public spending on long-term care. It is mostly paid on behalf of those who are very poor or who have self-impoverished to meet eligibility standards.

60% of our national expenditures on long-term care, as I have defined it, are through Medicaid, with 5% through Medicare and other government programs.  35% is paid privately, out of pocket or through private long-term care insurance.

Family caregiving

What is not included in these numbers, however, is informal caregiving, unpaid care provided by family members and friends. The AARP Public Policy Institute estimates that, in 2013, 40 million caregivers provided 37 billion hours of such care for ADLs and IADLs.  If paid at $13 per hour, the average base wage of a home care worker in 2013, this represents about $470 billion in economic value…for care that is otherwise free!

According to the U.S. Department of Health and Human Services, in 2011, family and friends collectively provided 75–80% of total care hours in non-institutional settings.

Thus, our long-term care system, if you can call it a system, has three main parts:

  • The first is a comprehensive Medicaid safety net program for those without resources and unable to care for themselves, both young and old. The program guarantees a bed in an institution, its original mandate, but has increasingly shifted to home and community-based care in most states, due to strong public preference and, in part, to a landmark 1999 Supreme Court decision that interpreted the ADA as requiring that care be offered in the least restrictive setting possible. The fact that such care is less expensive in the long run has also contributed to its growth. Today, over 50% of Medicaid long-term care funds is used for home and community care and the percentage is growing.
  • The second is out-of-pocket spending, either directly or through long-term care insurance, insurance held by only 8% or so nationally, primarily due to cost and unreliability.
  • The third part is the massive amount of unpaid family caregiving provided to working and middle-class disabled young and old adults who cannot afford the cost of care, but who are not eligible for Medicaid.

This family caregiving is at the center of the emerging crisis. Let me explain.

2030 caregiving crisis

There are about 77 million members of the huge baby boomer cohort alive in the U.S. today and they began reaching retirement age in 2011.  Between 2030 and 2050 they will become 80+ years of age, the “oldest old” in our society. This “oldest old” demographic will grow from 11 million in 2010 to 35 million in 2050, a tripling, while the overall population grows only modestly.

The birth dearth that followed the postwar boom created the problem. In 2010 there were 7.2 available family caregivers 45–64 years of age for every American 80 years of age and older.  According to the AARP, however, using census-based projections, by 2050 there will be only 2.9 such family caregivers for this population, a stunning drop of over 50%.

Thus, as the number of oldest old accelerates upward, the number of available family caregivers will be shrinking.

By 2040, 1 in 5 women 80-84 years of age will be childless. In 2010 only 1 in 9 were childless. 40% of those 85 years of age or older in 2013 were living alone.  This percentage is expected to grow larger over the next two decades.

So, who will care for us boomers when we become the oldest old? A heavy burden will obviously fall on the small cohort of middle-aged children of boomers, Generation X and early Millennials, but, as importantly, there simply won’t be enough of them.

But aren’t boomers wealthier and better able to pay for care?

In 2014, the median cost of a semi-private room in a New York nursing home on a private pay basis was $132,000 annually.  The median rate for a personal care aide from an agency was $21 per hour.  At six hours per day, this amounts to about $44,000 annually.

While boomers are technically the wealthiest generation, this is based on average net worth and is skewed by wealth inequality. Median net worth, a better measure, has been running 40% or more below the mean. Pre-recession studies showed that the lower two quartiles of boomers nearing retirement, and part of the third, consisting largely of working and middle-class families, did not have nearly enough to meet their upcoming retirement needs.

And that was pre-recession.  With the housing bust and recession factored in, the situation has become much worse.  Half of boomers surveyed by AARP in 2011 reported serious financial hardship.

Adding to the affordability problem is the weak financial standing of their future caregivers, their adult Generation X and early Millennial children.  Generation X as a group lost nearly half its wealth between 2007 and 2010, a larger decline than that of any other generation. In 2011, GenXers who carried debt carried six times more than their parents did at the same age. Over 50% of the current $1 trillion dollars in student loan debt is held by Generation X, with Millennials holding 40%. These may be the first generations since WW II to have less wealth than their parents.

Even more concerning is the fact that many women in these cohorts will be in the workforce, to pursue a career or achieve a middle-class lifestyle, or both.  They will be in their peak earning years between the ages of 45-64 when their older boomer relatives will be into their 80s. And they may also be dealing with expenses associated with raising children, including their college education.

There will be enormous pressure to reduce work hours or leave jobs to care for an older relative. Unpaid caregiving is already a major women’s social justice issue.  This will certainly be amplified over the next few decades.

But aren’t boomers going to be healthier and need less care?

The answer to this question is…Yes and No.

Yes. Modern medicine and declines in smoking will allow many boomers to make it to old age, through reductions in deaths from heart attack, stroke, cancer, infection, and other conditions.  Boomers will also benefit from knee and hip replacements, corneal transplants, and other new technologies that can stave off or mitigate disability.

But the answer is also No. As more of this huge cohort make it into their 80s, disabling, care-intensive chronic conditions are expected to dominate, especially frailty syndrome, mobility disorders such as osteoarthritis, and all forms of dementia.

This will be largely due to the secondary effects of boomer obesity, sedentary lifestyle, lack of exercise, and stress.  These effects include lifelong struggles with hypertension, high cholesterol, and metabolic and inflammatory disorders. Not only do boomers suffer these conditions at a higher rate, they have had them from a much younger age causing greater damage. While declines in smoking and the use of medications has certainly helped, all signs still point to a serious, continuing impact on the health of the very old.

Mobility disorders and frailty are insidious since reduced physical activity leads to a loss of muscle mass which causes further mobility decline, in an accelerating downward spiral, often leading quickly to being bed or wheelchair bound.


But the greatest threat on the horizon is the expected increasing prevalence of dementia, especially Alzheimer’s disease. Dementia care is at the heart of the impending caregiving crisis. Dementia will be the most important driver of care need.

In 2016, according to the Alzheimer’s Association, 15 million unpaid caregivers provided 18.2 billion hours of care to family members and friends with dementia, over 1000 hours each. By 2050, these numbers are expected to triple.

Many years with hypertension and high cholesterol causes damage to brain blood vessels and brain white matter. Add in high levels of chronic stress, anxiety disorders, depression, type-2 diabetes, and pre-diabetes, all known risk factors, and all more prevalent among boomers, and we face a possible increased incidence of dementia, adding to the increased prevalence already baked into the huge boomer numbers.

But the true problem with dementia caregiving is its intensity.  In addition to closely monitoring and cueing a patient with moderate or advanced disease, caregivers must wrestle with an array of aberrant behaviors, including agitation, aggression, anxiety, delusion, disinhibition, loss of appetite, insomnia, pacing and wandering.  The physical, mental, and emotional strain on caregivers can be overwhelming.  Dementia caregivers suffer the highest rates of depression and anxiety disorders.

So, that is our impending 2030 crisis.  In summary: Growing numbers of oldest old with disabling conditions and inadequate resources, coupled with declining numbers of family caregivers with their own resource issues and facing an intensifying caregiving burden. A kind of perfect storm.

And there is more. We must also deal with a growing shortage of formal home care workers. While most aides are dedicated and feel good about their work, one in two leaves their job within 12 months, citing low wages, limited benefits, and poor working conditions. Burnout and turnover are endemic.

And the current anti-immigrant sentiment in Washington is having a further impact on supply. Temporary Haitian and Central American immigrants are getting ready to pack their bags.

In 2012, the Bureau of Labor Statistics projected a need for about one million new jobs in home care, including home health care, by 2022, and that is well before the expected crisis surge. Severe shortages are already emerging in rural areas.

Political and policy consequences

I have been asking myself and others for several years now the following question: Given this obvious need, why has long-term care been marginalized in health care reform discussions, including in the Medicare for all community?

Some suggest that long-term personal care is simply not part of health care and is best treated as a separate social service. Personal care aides are not trained in medical procedures and, in many states, are not even allowed to put pills into pill boxes.  Custodial care, they say, is outside the scope of medical practice.

This view is quite prevalent, even among those OECD nations with universal health insurance programs. Most OECD long-term care programs use separate funding streams and are administered by different departments and political units.  They are also subject to often substantial cost-sharing, and eligibility and service restrictions. Coordination between long-term personal care and medical care is accordingly weak in most of these countries.

This sharp separation is meant, I believe, to allow countries to better control the financing of long-term care, and, especially, to ensure a major role for unpaid family caregivers.  With few exceptions, OECD long-term care programs are structured to encourage family caregiving. This may occur by offering modest incentives such as tax deductions, family leave, caregiver support services, or small cash benefits.  It can also be done by restricting services or adding excessive cost sharing, in effect forcing family caregivers to pick up the slack. France, for example, requires an average of 30% in cost-sharing for the non-indigent, and out of pocket costs for the non-indigent are even higher, on average, in Switzerland, Canada, England, and elsewhere.

The goal, say all these countries, is to lighten the intensity of family caregiving, not to replace it. But the real goal, as I see it, is cost control. Even Sweden and the Netherlands, both with strong and generous publicly funded long-term care programs, have recently made reforms along these lines.  It’s even called “refamilisation” in Sweden. Both countries are also increasing privatization efforts in a further effort to save money.

Japan, interestingly, takes a different approach. Under political pressure from women who want to be in the workforce, from a growing workforce shortage in the face of an ageing population, and from a reluctance to bring in foreign workers, Japan does not incentivize family caregiving. They instead offer formal services to all who need it.

Yet, Japan still considers caregiving to be a social service and not health care, and they impose special social security premium fees, levied on all citizens starting at age 40, and increasing at age 65. Japan is expecting to have to increase these fees in the future.

Only Scotland and Denmark have truly generous, publicly financed, and mostly cost-free programs that offer formal services to anyone, with few restrictions and without regard to the availability of family caregiving. However, their funding and operational systems still accept the inefficient division between medical and social services, and they too are coming under political pressure to reduce long-term care costs in the face of an ageing population.

Separating medical and long-term care is a mistake.

Long-term care should be seen as part of a health care continuum, exactly as it is treated in HR 676.  Most functional disabilities, particularly among older adults, are due to chronic physical or mental illness. Managing disability-associated ADLs and managing chronic illness are two sides of the same coin.

Consider transitions. Health care for older adults involves preparing for and managing transitions: into and out of acute care hospitals and post-acute rehabilitation facilities, along with institutionalization, palliative care, and hospice. Movement from mild or moderate stages of a condition to advanced stages can involve significant changes in care or care setting.  A fall and fracture due to osteoporosis, or a single episode of flu or pneumonia, can cause a rapid decline in health status of an “oldest old” adult.  In such cases, home medical care may be needed, and the intensity of home personal care can change abruptly in the light of continence issues, mobility constraints, and mental health changes.

Preventing, delaying, and managing transitions requires coordination and integration of both medical and personal care services.

In addition, it is well recognized that psychosocial well-being can be affected by medical conditions and that a poor home or social environment, like being left alone for all or part of the day, can worsen a medical condition.  Chronic illness can lead to or worsen depression and anxiety disorders, which can then, in turn, lead to or worsen medical conditions in a downward spiral.

Providing a dignified and comfortable living environment for a disabled adult, young or old, is health-promoting and can help reduce downward health spirals.

Hence, in addition to creating an inefficient workforce hierarchy and encouraging a wasteful duplication of administrative work based upon multiple funding sources, this separation also disguises an unacceptable health care philosophy.

Programs that integrate personal and medical care, and work with a unified funding stream, such as the Program for All-inclusive Care for the Elderly, or PACE, have shown that a unified approach has superior outcomes, including reduced hospitalizations.

HR 676 takes the bold step of including long-term personal care as a co-equal benefit in a universal health insurance program.


We must recognize that the omission of long-term care as an aspect of a universal health care system in the U.S. is ultimately political and related to cost.  It is the basis for the politically-motivated criticisms of single-payer economic models by those who nominally support the idea (as “aspirational”, of course); your Ken Thorpes, Ezra Kleins, Paul Krugmans, Urban Institutes, and many others.

And this no doubt includes some Senate bill co-sponsors.

Given the huge size of the currently unserved working and middle-class populations, however, shouldn’t we be concerned about the cost of the increased utilization of services that will no doubt follow from the implementation of HR 676?

Some call this a “woodwork effect” because of the hidden nature of the potential new demand for services.  Should we fear woodwork effects?

A close look shows that such woodwork effects, while significant, will be much smaller than what is suggested by the AARP figures.

There are several considerations involved.

The first involves establishing a baseline for services. Medicaid offers a comprehensive long-term care program and its standards can be used for such a baseline. The problems with Medicaid are mostly a function of its poor funding, not its scope of services.

Medicaid, however, limits care hours in the home and community. Formal paid care will usually not be authorized, for example, if an able caregiver is present, such as a spouse.

In addition, Medicaid hours for IADL services are strictly limited in most states, and most services will likely be affordable, and therefore the responsibility of the client, if the program is expanded to include those at higher income levels.

60% of the hours identified by the AARP surveys involved such IADL services. Most will be excluded, therefore, which will limit the extent of woodwork effects.

A second consideration is the likelihood that even with the offer of cost-free formal care, family caregivers will continue to provide unpaid care.

Family caregivers generally have a positive attitude toward caring for a loved one. Their concern relates primarily to the need to be in the work force, or at school, or to the strain of long hours of highly intensive care such as would be needed by an advanced-stage dementia patient.

Studies have shown that when public financing of home care is made available, family caregivers do not just stop providing care. Instead they typically give up just a part of usually the most intensive care. In a Brookings review of 52 home care demonstration projects, only 4 showed an overall reduction in family caregiving hours.

Scotland introduced a universal, free long-term care program in 1998, covering institutional care and home care with no financial eligibility restrictions. By 2002, it was fully up and running. They set aside a pool of funds they thought would be needed to address increased utilization at the outset, but the fund was largely unused. Studies showed that the formal caregiving in Scotland was primarily used to relieve family caregivers of only some of the more burdensome work, and many eligible families simply did not apply.

In some cases, care recipients or their families were just reluctant to have a stranger join their household for any extended period of time.

A third consideration involves supply constraints. While nursing home beds are generally available, there is already a growing shortage of home care workers in the U.S., as noted earlier.

Such supply constraints will limit initial woodwork effects while the nation addresses the supply problem. Family caregivers, reluctant to place loved ones in nursing homes, will remain in place while clients wait to access services and states work to increase supply of care workers.

A fourth consideration involves administrative cost savings.  While Medicaid has relatively modest administrative costs, the inclusion of long-term care in HR 676 will still provide savings. It will reduce the current huge collection of programs, Medicaid and otherwise, within and across 50 states to just a few integrated options, and the army of counselors and lawyers currently helping clients navigate the complex system will be substantially diminished.

And provider organizations will have to deal with only a single funding stream.

Finally, even if it turned out that costs would be somewhat higher than expected, would not the public be willing to pay a modest additional tax to gain access to low-cost guaranteed long-term care insurance? Especially in light of an ageing population and the emerging caregiving crisis? And, of course, there is always the option of simply paying for it directly with general federal revenue, as we would pay for a war or other emergent crisis.

The Sanders team should put long-term care into their bill immediately. Putting it off to some nebulous future additional legislation diminishes the importance of this critical area of social policy.

It also ignores the many important new constituencies that can be recruited to the Medicare for All movement. This includes older adults, adults nearing retirement, and younger adults who are worried about becoming caregivers. It could also bring in the millions of paid direct care workers who would see the value of their work increased.

Not least, it can bring in those tireless advocates for people with disabilities who were responsible for the Americans with Disabilities Act and other federal and state laws and programs that protect the vulnerable.

After all, these folks will be disabled for a lifetime.

Their problem is not self-impoverishment. They must start out impoverished in order to qualify for Medicaid and a paid personal care aide.  Then they must stay impoverished. Many abandon career aspirations in order to maintain the low-income status needed to qualify for Medicaid. They turn down raises, forego employment and educational opportunities, and are often forced to turn assets over to an external trust that restricts access and use.

Disability rights activists are rightly disappointed in the failure of the Sanders team to include long-term care.








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