Medicare Is, After All, Health Insurance....

Jane Gross presents a decent case that elderly people would benefit from having long-term care insurance. She also suggests that Medicare would benefit from denying coverage for certain medical treatments and procedures based upon the age and medical condition of the beneficiary.

Yet Medicare, which pays for all of the above, does not, except in rare instances, pay for long-term care in a supervised, safe place for frail or demented old people, or for home aides to help with shopping, transportation, bathing and using the toilet.

Well, yeah, because Medicare is health insurance, not long-term care insurance.

When the Obama Administration attempted modest steps toward educating the elderly about their end-of-life medical choices, the political right went into propaganda overdrive, shrieking about "death panels" and health care choices being dictated by government bureaucrats. When the Obama Administration attempted to create a means of making available affordable long-term care insurance, it became clear that most people would not voluntarily buy it and that, as a consequence, it would be all-but-unaffordable to those who wanted it.

Nationwide, the median annual cost of a nursing home in 2010 was $75,000; room and board in an assisted living facility, with no additional help, was $37,500; and the most basic category of home health aide, who can perform no medical tasks, like the dispensing of medication, was $19 an hour. These expenses are left to the elderly (and their adult children) to pay for out of pocket until their pockets are all but empty.

Then they are eligible for Medicaid, the state-run safety net for the poor. While Medicare, a federal program, is financed by payroll taxes, and thus is an “earned” benefit, Medicaid is “charity,” in the minds of the formerly middle class who worked their whole lives and never imagined themselves destitute.

I'm not sure what to make of this. Medicare was not and is not intended to be long-term care insurance, even if people need long-term care insurance. Even if we could achieve significant savings through elimination of such health insurance benefits as feeding tubes, "Abdominal and gall bladder surgery and joint replacements, for those who rank poorly on a scale that measures frailty," and "Tight glycemic control for Type 2 diabetes" for those who will likely die before suffering serious complications from diabetes, as the author suggests, and even if we deny costly medical treatments and surgeries for those who might not benefit, we would not achieve savings sufficient to offer long-term care insurance as part of Medicare. Meanwhile, at least when you're indigent, Medicaid does provide long-term care coverage. I appreciate Gross's argument that people who spend down their assets and qualify for Medicare might perceive it as "charity", but even if we called it "Medicare" would it be any less of a charitable program? You would still have to pay for the new benefit out of the general fund.

In the case of my mother, who died at 88 in 2003, room and board in various assisted living communities, at $2,000 to $3,500 a month for seven years, was not paid for by Medicare. Yet neurosurgery, which I later learned was not expected to be effective in her case, was fully reimbursed, along with two weeks of in-patient care. Her stay of two years at a nursing home, at $14,000 a month (yes, $14,000) was also not paid for by Medicare. Nor were the additional home health aides she needed because of staffing issues. Or the electric wheelchair after strokes had paralyzed all but the finger that operated the joy stick. Or the gizmo with voice commands so she could tell the staff what she needed after her speech was gone.

She paid for the room. My brother and I paid for the private aides and bought her the chair and the “talking board.” What would her life have been like without the skilled care she required and the ability to get around her floor and communicate her needs? I shudder to think. But none of this was Medicare’s responsibility.

Yet Medicare would pay for “heroic” care for a woman who was dying of old age, not a disease that could be treated: Diagnostic tests. All manner of surgery. Expensive medications. Trips to the emergency room or the hospital — had she not refused all of them, in the last year of her life. So, in less than a decade, by my low-ball estimate, my mother spent $500,000 of her own money and uncalculated sums from her two children before winding up what she considered, with shame, “a welfare queen.”

The author warns us, "Alas, 70 percent of the elderly will need extended care before they die." But I'm not hearing a solution. Yes, we can improve the efficiency of Medicare and, if we can push back against Sarah Palin-style propaganda wars designed to frighten Medicare recipients, we can better allocate resources. But the idea that the savings could pay for meaningful long-term care insurance seems like wishful thinking. The author has been writing about these issues for a long time, yet while she shares the cost of Medicare and lets us know that future costs are "scary", she does not attach any projection of what her proposal to also cover long-term care would cost. Consider,

In 2003, Medicaid paid $83.8 billion dollars for long-term care services, roughly one-third of all Medicaid spending. 27.8 billion of these dollars were spent on community-based long-term care services.

If we are to be frightened that "there are 47 million Medicare beneficiaries, costing a half trillion dollars a year", and that "In 2050, the population on Medicare will number 89 million", what of this:

The aging of the population, especially those 85+—the most in need of long-term care—is expected to result in a tripling of long-term care expenditures, projected to climb from $115 billion in 1997 to $346 billion (adjusted for inflation) annually in 2040.

You cannot pay for that by trimming the fat from Medicare. If people want Medicare to include long-term care coverage, contributions will need to be raised significantly.