Steve Moses has been studying and advocating for better long-term care (LTC) for decades. In the latest Cato Policy Analysis, “Better Long-Term Care for Billions Less,” Moses explains how Medicaid dominates the market for LTC services and supports, reduces LTC quality, and subsidizes wealthier individuals at the expense of the poor.
Counterintuitively, Medicaid subsidizes LTC for middle-class and affluent individuals, who do not need government assistance. Middle-class people easily qualify for Medicaid under the basic financial eligibility rules. Some individuals with significant assets artificially impoverish themselves to become eligible for and receive Medicaid LTC subsidies.
Eliminating Medicaid LTC subsidies for individuals who could meet or could have planned to meet their own LTC needs would improve LTC quality and reduce the burdens Medicaid imposes on taxpayers. Middle-class and affluent seniors could draw on their assets and private LTC insurance, saving Medicaid as much as $100 billion per year without impairing its ability to serve those who truly need assistance.
The situation is fairly insane.
Why should amassing wealth that will pass to heirs take precedence over funding quality LTC for the living? Why should Medicaid force taxpayers to pay for LTC for those who would get it anyway, where subsidies serve no other purpose than to protect the inheritances of those individuals’ heirs?
Moses offers eight specific reforms that would rededicate Medicaid to its original purpose of providing assistance to those who cannot help themselves. And he doesn’t flinch from the stark reality: “To fix LTC, Medicaid LTC caseloads must decline dramatically.”