Congress inches toward a national policy on long-term care

Healthcare Financial Management, Sept, 1989 by Joseph A. Kuchler

Congress inches toward a national policy on long-term care

Although the growing demand for long-term care services calls for a comprehensive national policy, Congress has dealt with the issue in a piecemeal fashion. Sweeping changes have been deferred from year to year, amid considerable debate. Long-awaited action is expected in 1990, however, with four major bills on financing long-term care pending in Congress and recommendations due from a bipartisan commission.

Long-term care (LTC) raises major public policy questions of financing, coverage, administration, and payment for services. Asking policymakers for a comprehensive national solution, however, draws the now-familiar refrain, "Wait until next year."

During 1988, the issue entered the national arena as never before. Presidential candidates debated it, and lawmakers introduced four major bills in Congress to cope with financing LTC services. None of those measures passed, but Congressional leaders promised decisive action--next year.

Unfortunately, a backlash from higher-income elderly persons over the supplemental Medicare premium required by 1988's catastrophic coverage law has made Congress gun-shy about proposing new benefits that include substantial cost sharing. And with the recent death of Rep. Claude Pepper (D-Fla.), Congress lost its most visible and outspoken advocate for sweeping changes in LTC policy.

This year, as Congress moves toward completing another session, health leaders again predict major LTC action--next year.

While LTC is one of the most crucial policy issues facing the nation, it is also one of the most difficult to address through comprehensive change. One deterrent is the scope of the issue. A common--but mistaken--definition views LTC simply as nursing home care for the elderly. LTC is much broader, encompassing:

* Services, such as skilled

nursing, intermediate, and

custodial care, rehabilitation, and

social services;

* Patients varying from the

young to the old, the disabled

to the mentally retarded;

* Settings that include nursing

homes, hospital "distinct part"

units or "swing beds," and

patients' homes; and

* Financing sources, such as

self-pay, private insurance,

Medicaid, Medicare, and other

government programs.

From time to time, leaders inside and outside of Congress propose consolidating a variety of LTC benefits into a new Medicare Part C. These plans have not received serious consideration, in part because they ignore the fact that Congress finds it easier to patch a flawed system rather than scrap it and build a new one.

Any changes Congress adopts in LTC during 1989 likely will follow the pattern of recent years: a piece at a time. On broader questions, such as financing LTC services, Congress appears inclined to wait for recommendations from the Bipartisan Commission on Comprehensive Health Care.

The commission, created under 1988's catastrophic coverage law, has until March 1, 1990, to propose ways to finance LTC. Federal lawmakers, in turn, plan to act on that advice--sometime next year.

Changes come piecemeal

Although Congress has shied away from adopting broad LTC reform, its piecemeal approach has brought changes in benefits, payments, and quality of care. In the past five years, lawmakers re-established dual payment rates for hospital-based and freestanding Medicare skilled nursing facilities (SNFs); expanded Medicare's swing-bed program for rural hospitals; created survey and certification requirements for nursing homes; and broadened Medicare LTC benefits and coverage criteria.

A Federal task force on LTC insurance policies also made a series of recommendations. Many were adopted or received serious discussion on Capitol Hill. Last year's extensive debate on the subject also drew attention to the need for wholesale changes, particularly in financing.

Bills proposed in 1988 will provide a framework for the bipartisan commission on comprehensive health care and for 1990's renewed debate on LTC financing.

Catastrophic coverage

The Medicare catastrophic coverage law, which took effect Jan. 1, 1989, eliminates the three-day prior hospitalization requirement for SNF benefits and increases the number of covered days to 150 from 100. Beneficiaries must pay coinsurance of $25.50 daily for the first eight days of care.

The law also eliminates Medicare's "spell of illness" concept and extends the hospice benefit beyond the previous 210-day limit, if the patient is recertified as terminally ill. In other provisions, the measure expanded intermittent skilled care coverage for home health services. Coverage of "daily" care now may be obtained as often as seven days per week for a maximum of 38 days in any period. This change becomes effective Jan. 1, 1990, as will another revision providing up to 80 days of in-home respite care services.

Congressional analysts anticipate no alterations in extended care benefits enacted under the catastrophic coverage law.

Financing proposals

Although the catastrophic coverage bill was developed to shield the nation's elderly from catastrophic healthcare expenses, the law fails to address the elderly's greatest out-of-pocket expense: nursing home costs. The four bills introduced in 1988 to broaden Medicare coverage for nursing home services were developed by chairmen of key health committees and subcommittees.