The Cost of Growing Old in America

Howard Gleckman is a journalist who has covered health policy for the last ten years. Currently, he's a columnist for Kaiser Health News and a fellow at the Urban Institute. Earlier this year he wrote an article for AARP's Bulletin magazine on adding long-term care to the health care debate. Also this year he wrote Caring for Our Parents, an engaging book that provides a holistic look at the aged and frail (yeah, I'm talking about Medicaid here, not just the people it supposedly serves). I chatted with him earlier this week.

First, a quick Medicare/caid rundown: Medicare is the goverment's health insurance plan for persons aged 65 and over. Medicaid was designed for poor women and children, people with (designated) disabilities, and those few folks in need of long-term care. Both were created by Congress in the 1960's. Gleckman explained why long-term care is consuming more and more of Medicaid:
"In the 60's, Congress drew an artificial line between long-term care and medical care. For the most part, health care reform is focused on insurance and acute care. Not chronic and LTC. Congress is still in that box. It's not two different issues for families."

As Caring for Our Parents highlights, long-term care insurance is so expensive and plagued with all the same problems as health insurance (pre-existing conditions and the like) that several of the big companies selling it have gotten out of the business. Yet, countries like Germany, France and Japan (you know, the ones with decent health coverage for all their citizens) rely on government long-term care insurance - and their populations are almost twice as old as ours. The late Senator Edward Kennedy introduced the Community Living Assistance Services and Supports (CLASS) Act as a possible solution.
"It would be the first time a government program would help people finance long-term care needs," Gleckman said.

93-year old Natalie was among those featured in the book. A three-time widow who was left very well off, she lived at a nonprofit assisted living facility, then later moved to its nursing home unit. Over a period of just a few years, she used up half a million dollars and ended up on Medicaid. Because she outlived her money, spending $16,000 some months just on her care, now she lives among the impoverished, sharing a room in that same nursing home. Isn't that the opposite of the American Dream?

"While there's an urban myth about people hiding money to get on Medicaid, the truth is most don't have it. Natalie had half a million. You get dementia, you spend all your money," Gleckman said.

According to Gleckman, 1/3 of those 65+ will not need any long-term care before they die. But 2/3 of those will need some to varying degrees, from an extra pair of hands to help with activities of daily living like dressing, cooking and cleaning, to those who can't do anything for themselves and require skilled nursing care. Often times, those who need just a little help end up in nursing homes because Medicaid in some states doesn't pay for adult day care or home health care.

Currently 1.4 million people are in nursing homes. Another 1 million are in group homes, and the biggest group, 7.5 million, are getting long-term care at home, with lots of the help provided at no or low cost by family and friends (perhaps one of the places the government saves the most money right now). Less than 10% have long-term care insurance.


  1. "While there's an urban myth about people hiding money to get on Medicaid, the truth is most don't have it. Natalie had half a million. You get dementia, you spend all your money," Gleckman said.

    Judging by that quote, it seems that the conclusion you're drawing is that the working class should pay for a new federal program so that the rich can get their care for free.

  2. Scott, I understood Gleckman's quote to mean that the cost of long-term care is so outrageous that even the rich can't afford it.

  3. Mr. Gleckman's solution is a federalized long term care insurance program. I am in favor of many aspects of the CLASS ACT as well.

    What I am not in favor of is burdening the poor and the lower middle classes with another federal program that won't benefit them as much as it benefits the rich and upper middle class. The poor and much of the middle class already receive free long term care services from the government. Taxing them (which is essentially what this is) is more of a direct benefit to the richest Americans than it is to the working class.