Vice President Kamala Harris announced an outline of a proposal that would allow Medicare to expand home health care coverage for older Americans. The Democratic presidential candidate announced the plan on the television talk show “The View.”
Harris said the aim is to ease the burden on the “sandwich generation” who are caring for children and elderly parents at the same time. He said the cost of this additional paid treatment could be covered by money the government saves by negotiating with drug companies to reduce the amount Medicare pays for prescription drugs. Harris also wants Medicare to cover more hearing and vision care.
The Conversation asked long-term care scholars Jane Tavares and Mark Cohen to assess what we know so far about the plan.
Why is long-term care important?
Long-term services and supports are one of the biggest expenses for older adults. This can range from non-medical assistance with meal preparation, bathing, dressing, and other activities of daily living to medical care in a skilled nursing facility.
Today's 65-year-olds have a 70% chance of eventually needing some type of long-term care as they age, and 20% will need long-term care for five years or more.
The costs associated with even one year of long-term care can prove unaffordable for most people. In 2023, the median annual cost for a private room in a nursing home was $116,796, and the median annual cost for a home health aide was $33 per hour. Eight hours of daily home care costs $96,360 per year.
The National Council on Aging found that 80% of older adults are unable to absorb economic shocks, such as the need for long-term care, without falling into poverty. The council noted that 20% of older people have no assets at all, and a further 60% cannot afford nursing home care or care at home for more than two years. The average length of stay in long-term care is just over three years.
Medicare currently does not cover long-term care, but it does cover short-term skilled home care for up to 21 days for recovery after a qualifying illness or injury and up to 100 days in a skilled nursing facility after qualifying. I am. hospitalization.
Medicaid currently covers about 61% of the nation's total long-term care costs, of which more than 70% goes to home services. However, Medicaid has strict income and asset eligibility requirements. Medicaid eligibility and coverage vary by state, but people who qualify for the program are at or near the federal poverty level and have less than $2,000 in personal assets or $3,000 for couples.
As of 2022, only 15% of Americans age 65 and older are covered by Medicaid.
Furthermore, the shortage of long-term care personnel is also an issue. In 2022, approximately 700,000 people were on Medicaid waiting lists for home and community-based services, and 10% of people with high health care needs were waiting in hospitals for nursing home slots.
What will be the impact of increasing the number of elderly people receiving care?
An estimated 77% of older Americans want to remain at home as they age, but one in five require assistance with activities of daily living. Because the cost of long-term care is high and coverage options are limited, unpaid family caregivers typically provide this care.
Expanding Medicare coverage to include skilled in-home long-term care, as Harris proposes, would make it easier for seniors to stay in their homes without falling into poverty. It could also help reduce the burden on unpaid family caregivers.
Expanding long-term care coverage beyond those enrolled in Medicaid has the potential to help many vulnerable seniors, although it depends on details that were not immediately available. .
For example, getting professional help with eating and bathing can help prevent health complications associated with malnutrition and poor hygiene. And this care is not at the expense of family caregivers, who may have to quit their jobs or take on additional physical and mental stress to provide care.
How much will this cost the government?
It is clear that the costs associated with a new program will depend on many factors. What matters most in this case is who qualifies, the circumstances under which they can receive these benefits, and how generous those benefits are.
Harris said she believes her proposed new Medicare home health benefit would be funded by savings from lower Medicare drug costs. Relatively recent estimates put the savings in 2026 at $6.3 billion.
But to raise more money to pay for benefits, Ms. Harris would expand Medicare drug negotiations, increase the discounts drug companies cover for certain Medicare brand-name drugs, and The plan is to crack down on pharmaceutical benefit managers, the intermediaries between the two. Companies, pharmaceutical manufacturers, pharmaceutical wholesalers.
Researchers estimate that aggressive Medicare drug negotiations could save approximately $450 billion over 10 years. That's enough to cover the estimated $40 billion cost of the influential Medicare home care benefit by the Brookings Institution.
The Harris campaign also identified other potential savings by simplifying the prescription drug supply chain. Current efforts are estimated to save Medicare $16 billion over the next 10 years.
Harris' proposed plan would allow Medicare to provide routine vision and hearing coverage. This would result in relatively small changes in costs to Medicare and potentially reduce out-of-pocket medical costs for older adults. Research also shows that enhancing vision and hearing care indirectly reduces Medicare costs. Because it can help prevent falls and reduce depression and cognitive decline.
Why hasn't Medicare covered home health care until now?
When originally launched in 1966, the Medicare program was intended to cover acute medical services. Back then, life expectancy was shorter than it is now. That meant fewer Americans over age 65 were eligible for those benefits and lived long enough to need long-term care.
For the next 60 years, there were no public insurance programs like Medicare to help people pay for their medical care.
But back in 1994, lawmakers were crafting proposals to cover long-term care. Lawmakers recently introduced legislation that could close this gap. But many previous efforts failed because there was no agreement on how to pay for these benefits and whether they should cover everyone or only low-income people.
In the absence of the federal government stepping up, some states have instituted their own policies.
Washington state is the most advanced in this effort. The government created a public long-term care insurance program that allows working Washingtonians to contribute a few percent of their income to a fund and use their benefits to pay for services. However, the program could become optional due to ballot measures that Washington state voters will consider during the November 2024 election. We believe that allowing people to opt out will likely make the program unsustainable.
California has also moved forward, completing two feasibility studies to explore the possibility of a statewide long-term care insurance program. California also removed financial asset limits for Medicaid eligibility in 2024, allowing the program to expand to more seniors in the state.
This article was originally published on October 8, 2024. It was updated the next day to include more details about Harris' proposed changes to the Medicare program.
