Developing Massachusetts’ Roadmap for LTS Financing Reform Long-Term Care Financing Advisory Committee Meeting September 10, 2009 For Advisory Committee Policy Discussion Purposes

Agenda  MA financing mechanism fact sheets  LTS financing recommendations from MN and WA  Guiding principles for a reformed LTS financing system in MA  Consideration of a “straw man” financing proposal  Committee business  Public input process 2 For Advisory Committee Policy Discussion Purposes

MA Fact Sheet Check List 3 Informal Caregiver Support Savings/ Assets Insurance Products Contribution Program Public Other MA Unpaid informal caregivers  Reverse mortgages on real property  Life insurance policies/Annuity contracts  Long-term care insurance policies  Long-term care Partnership  Enhanced public or private health insurance  Contribution/pooled risk program  Minimize disparities in access to Medicaid LTS  Community-based strategies  For Advisory Committee Policy Discussion Purposes

Financing Recommendations in MN and WA 4 Informal Caregiver Support Savings/ Assets Insurance Products Contribution Program Public Other MNWA Unpaid informal caregivers  Personal Savings/Health Savings Accounts (HSAs)   Reverse mortgages on real property  Life insurance policies/Annuity contracts   Long-term care insurance policies  Long-term care Partnership  Enhanced public or private health insurance   Contribution/pooled risk program   Minimize disparities in access to Medicaid LTS Integrate financing and care delivery for duals  New public program (subsidized or CommonHealth-like) Community-based strategies/partnerships  Add NF coverage to Medicare  Family loans/lines of credit  Better retirement planning (information & incentives)  Recommended Strategy  Evaluated Strategy For Advisory Committee Policy Discussion Purposes

Principle Statements For Advisory Committee Policy Discussion Purposes

The reformed LTS financing system will: 1. Ensure a strong safety net for the poor and most vulnerable 2. Minimize the financial pressure on Medicaid 3. Encourage personal responsibility for financing LTS to the maximum extent possible 4. Enable people to access the LTS they need without becoming impoverished 5. Ensure appropriate participation of and support for informal caregivers Principle Statements 6 For Advisory Committee Policy Discussion Purposes

“Straw man” Financing Proposal For Advisory Committee Policy Discussion Purposes

Questions for Assessing Financing Proposal(s) 1. Who is most likely to benefit? 2. Who bears the costs? 3. How broadly is the risk spread? 4. How much LTS coverage does it get us and for how many people? 5. Cost and savings estimate? 8 For Advisory Committee Policy Discussion Purposes

Low High FINANCIAL RESOURCES High LTS NEED Low Medicaid Personal Resources Medicaid Spend-down Current LTS Financing System 9 LTC Insurance For Advisory Committee Policy Discussion Purposes

Short-term Financing Reforms A. Advance Planning for Private Financing of LTS 1. Launch an education/awareness campaign 2. Encourage the private purchase of LTC insurance a) Enact NAIC model act/regulation b) Become a LTC Partnership state c) Promote transparency of LTC insurance costs and benefits d) Encourage/require flexible benefits or specified LTS benefits B. At time of need for LTS 1. Provide support for informal caregivers a) Strengthen/expand respite and other caregiver support programs b) Expand caregiver training (clinical and system navigation) 2. Implement consumer protections re: reverse mortgages 10 For Advisory Committee Policy Discussion Purposes

Low High FINANCIAL RESOURCES High LTS NEED Low Medicaid Medicaid Spend-down With Short-term Financing Reforms 11 Personal Resources Consumer Protections Informal Caregiver Support LTC Insurance LTC Partnership For Advisory Committee Policy Discussion Purposes

Longer-term Financing Reforms (with Contribution Program) A. Advance Planning for Private Financing of LTS 1. Encourage enactment of/participation in federal CLASS program or 2. Develop/launch a new state contribution program 3. Encourage the purchase of supplemental LTC insurance to cover services not covered by state or federal contribution program B. At time of need for LTS 1. Provide additional support for informal caregivers E.g., expand programs that pay informal caregivers; expand paid/unpaid family leave for public employees; extend subsidized health coverage to caregivers; create specific tax credit for informal caregivers 2. Expand Medicaid to cover LTS not covered by state or federal contribution program E.g., expanded LTS; flexible benefits/consumer direction; increased income/asset limits for people participating in contribution program 12 For Advisory Committee Policy Discussion Purposes

Low High FINANCIAL RESOURCES High LTS NEED Low Medicaid ( Enhanced) Medicaid Spend-down With Short- and Longer-term Financing Reforms (with Contribution Program) 13 Contribution Program Personal Resources Consumer Protections Informal Caregiver Support LTC Insurance LTC Partnership For Advisory Committee Policy Discussion Purposes

Alternate Longer-term Financing Reforms (without Contribution Program) A. Advance Planning for Private Financing of LTS 1. Encourage private purchase of LTC insurance a) Tax incentives for individuals and employers b) Encourage employer to make group LTC insurance available to employees (pre-tax?) c) Other? B. At time of need for LTS 1. Provide additional support for informal caregivers (same as Slide 12) 2. New state LTS program (CommonHealth-like) E.g., “wrap” to public or private health insurance; expanded LTS; sliding scale premiums (based on income or income/assets); state subsidy for people below certain income/assets – asset limit can be higher for people with qualified LTC Partnership policy 14 For Advisory Committee Policy Discussion Purposes

Low High FINANCIAL RESOURCES High LTS NEED Low Medicaid Medicaid Spend-down With Short- and Alternate Longer-term Financing Reforms (without Contribution Program) 15 New state LTS program (CommonHealth-like) LTC Insurance LTC Partnership Personal Resources Consumer Protections Informal Caregiver Support For Advisory Committee Policy Discussion Purposes

Committee Business For Advisory Committee Policy Discussion Purposes

Committee Business  Public input process  Recommended approach  Next meeting:  Date: Thursday, October 15 th, 2009 from 9:00 -11:30am  Location: 21 st Floor, One Ashburton Place  Future meeting reminders:  November meeting rescheduled to Thursday, November 12 th  Additional meeting scheduled for Thursday, December 10 th 17 For Advisory Committee Policy Discussion Purposes