the nation’s long-term care costs. Private insurer estimates
are typically higher due to a heavier weighting on higher-end
providers.
Most Americans mistakenly think Medicare will pay entirely
for this non-medical, low-skill service. Medicare pays for short-term stays—up to 90 days—in nursing homes for rehabilitation,
but not for chronic care. Medicaid, instead, picks up most of
the burden.
Medicaid, by far, accounts for the largest portion of total
national spending on long-term care. A 2011 study by the Henry J. Kaiser Family Foundation, based on 2008 data, showed
that Medicaid made up 40 percent of total domestic spending on long-term care spending, versus the 9 percent funded
by private insurers and the 22 percent paid for out of pocket
by individuals and their families. Medicare picked up 23 percent. Medicaid’s expenditures edged up to 43 percent when
the study just looked at dollars paid for nursing home care.
The idea behind public long-term care insurance was similar to Social Security with its benefit designed as a cash subsidy
for working Americans, albeit through an optional program.
But it theoretically could pay benefits to people who were in
their 20s until they died if they managed to work for three years
after signing up and paid five years’ worth of premiums. Unlike
Social Security, the law didn’t allow for taxpayer support but
mandated solvency for at least 75 years.
People with Long-Term Care Needs
total = 10. 3 million
42% are under age 65 • 58% are age 65 or above
community
residents
8. 8 million
(86%)
Nursing home
residents
1. 5 million
(14%)
THe HeNRY J. kAiSeR FAMiLY FOUNDATiON, MARCH 2011
under
Age 65
0 . 17 million
(2%)
“MeDiCAiD AND LONG-TeRM CARe SeRviCeS AND SUPPORTS”
Sources: Health Policy Institute, Georgetown University, analysis of data from
the 2005 National Health Interview Survey and the 2004 National Nursing Home
Survey
WINNERS and LOSERS
T
