3. Three-month "Front-end" Nursing Home Care Financing 1. 2. Individuals pay 20% of the costs of care up to a maximum of the national average cost of nursing home care. The federal government subsidizes the coinsurance at least for persons with incomes below 200% of the federal poverty level. The federal government is responsible for the home and community-based care program and the three-month "front-end" nursing home care program. The federal and state Administration 1. 2. 3. governments share the financial The federal government contracts with states to administer all three components of the plan. The federal government sets standards and guidelines for administration. These include the following: Standardized assessment criteria for determining eligibility for home and community-based care and nursing home care. Certification of assessment agencies. Guidelines for certifying case managers. Determination of case manager budgets. Determination of provider payment rates for home and community-based care and nursing home care. State administrative functions include the following: Building on the current infrastructure for management and delivery of services, where long-term care programs already exist. Designing and implementing the system for managing and delivering services, in states without existing programs. Certifying providers. Establishing the review and appeals process. Private Sector Role 1. Private long-term care insurance fills gaps not covered by this plan. 3. long-term care * government encourages the development of private insurance through clarification of the tax code. Treating, for tax purposes, the premiums paid and the benefits received as health insurance. Enabling qualified long-term care policies to be sold in employers' cafeteria plans. The federal and state governments share responsibility for standards and oversight of the private long-term care market. The federal government establishes minimum standards which States regulate private long-term care insurance, using Phase-In Schedule Phase I A maximum of 200 hours of home care per year is made available to all severely disabled persons. Phase II Phase III Phase IV The three-month "front-end" nursing home care benefit is The maximum hours of home care available per Begin to improve nursing home reimbursement rates. year is * The home care program is fully implemented. * Further improve nursing home reimbursement rates. Research Agenda for Long-Term Care 1. The federal government should move aggressively to contain costs and mitigate human suffering by funding a research and development program aimed at preventing, delaying and dealing with long-term illnesses and disabilities. This effort should include research on outcome measures and national practice guidelines in long-term care. That effort should move toward a funding level of $1 billion annually and should do the following: Explore how to reduce the risk for certain physical and mental disorders (e.g, Alzheimer's disease, osteoporosis, breast cancer, urinary incontinence) that are associated with increased need for long-term care Examine how to enhance the quality of long-term care including the integration of services and case management. Improve functional assessment tools to best target services to populations in need of care Examine the special long-term care problems of subpopulations such as disadvantaged racial and ethnic minorities and the rural elderly and nonelderly disabled. Evaluate the implementation of the home and community-based care program. Revenues for Long-Term Care A. Although some of the revenues necessary to support the above recommendations could come from savings achieved elsewhere in the federal budget, the Commission is committed to raising whatever additional revenues are necessary. B. In considering what revenue options to adopt, the Commission recommends that the choice be guided by the following three criteria: c. 1. 2. 3. The final tax package ought to be progressive, requiring a higher contribution from those most able to bear increased tax burdens. That is, families with higher incomes would be asked to contribute a greater share of their incomes than required of lower income families. Since persons of all ages would benefit, persons of all ages Revenues chosen should grow fast Various combinations of revenue sources may be used that together meet these criteria even if individual tax sources may fall short in one category. APPENDIX III Written answers submitted for the record by Louis W. Sullivan, M.D., Secretary of Health and Human Services in response to written questions submitted by Chairman Edward R. Roybal and Ralph Regula Chairman Roybal COMMISSION RECOMMENDATIONS Questions #1 A. Am I safe in assuming that you personally intend to be a helpful force in moving this debate forward toward the goal of universal health care access and full long term care protection? Answer Let me reassure you that I am personally committed to finding solutions to the problems in the financing of health care and long term care services. At the end of last year, I requested that a comprehensive review of our public and private health and long-term care financing policies be initiated. I asked Mrs. Horner, the Under Secretary, to lead this effort and to report back recommended approaches to these complex issues. And, in his State of the Union message in January, President Bush reinforced the importance of this initiative by designating me as the focal point within the Administration for addressing concerns of health care access, quality and costs. We are committed to health care policies that improve health care quality while constraining costs. Question B. The Commission has laid out funding criteria including progressive financing, multigenerational financing and financing that grows as fast as costs. Is this approach acceptable? If not, how would you finance these increased costs? What specific concerns do you have with the "access" portions of the Commission recommendations? What specific concerns do you have with the long term care portions of the Commission recommendations? Answer First, I believe that it is premature to discuss specific financing mechanisms to assure access when we have not yet agreed upon what it is we need to finance. The Pepper Commission recommended spending an additional $66 billion in Federal monies to ensure access and $20 billion more in incremental private sector costs. I am not sure that it is necessary to spend $66 billion to achieve the Pepper Commission goals. As you know, the Commissioners disagreed among themselves as to whether this was the proper level of costs. The Commission recommendations on access and long term care represent the nature of this debate: after careful deliberations, the Commission members could not reach a majority view on access, and could provide long term care reforms only at tremendous cost. My staff and I are also involved in thoughtful deliberations, but it is too early to reject or accept solutions to these complex problems. |