LTSS Finance Reform

Disclaimer

Throughout the MPA process, more than 100 proposals were developed thanks in particular to thousands of hours of work by external stakeholders and members of the public. These proposals and the MPA Council commentary are being submitted to the Governor and shared with policymakers and the public to inform policymaking. These proposals represent a starting point for discussion. Further discussion is necessary between relevant state agencies and stakeholders to both refine these proposals and assess which may be appropriate to adopt and implement.

Summary

Consider a new financing regime to pay for LTSS in the State, focusing on a long-term care social insurance model. This new program would supplement the existing Medicaid, the Expanded In-home Services for the Elderly Program (EISEP), and private long-term care insurance markets after conducting an actuarial study on LTSS financing model feasibility. This would consider the types of benefits, who should qualify, how it should be funded. and other variables and concurrent study of LTSS benefit design which includes cash-only, services-only, and an option between the two. It also covers all LTSS services, including examination of anticipated costs for funding of public education and workforce investments.

Justification

Existing long-term care financing options are insufficient and don't work for many New Yorkers. Many people must spend down their life savings to pay for long-term care. Nationally, there are major problems in the long-term care insurance market due to historic mispricing causing insurers to leave the market and premium rates to become unaffordable. Inability to pay for home care and long-term care has disproportionate effects on under resourced communities and social determinants of health (SDOH). Washington State has instituted a long-term care social insurance program and several states have conducted or in the process of conducting actuarial studies in consideration of implementation of a similar program that will directly address these issues.

Full Proposal

Establish a new financing regime to pay for LTSS in the State, focusing on a long-term care social insurance model. This new program would supplement the existing Medicaid, EISEP, and private long-term care insurance markets.

• Conduct an actuarial study on LTSS financing model feasibility, which would consider the types of benefits, who should qualify, how it should be funded and other variables.
• Study LTSS benefit design which includes cash-only, services-only, and an option between the two and covers all LTSS services, including examination of anticipated costs for funding of public education and workforce investments (at current scheduled home care minimum versus at 150% of the minimum wage) and to calculate projected Medicaid savings from the program.
• Convene stakeholders to come to consensus recommendations on a Finance Reform program based on the actuarial study results.
• Share report with the Legislature and Executive chamber for implementation.

MPA Council Commentary

This proposal is categorized as long-term. Complex procurement rules preclude New York State from accessing philanthropic funds. DOH and state agency partners can continue to evaluate long-term care financing and insurance options. Medicaid program changes and funding allocations must be considered within the context of the annual budget process and are subject to the availability of resources.