Practical Applications of Improving the System of Financing Long-Term Services and Supports for Older Americans

Abstract

Practical Applications Summary In Improving the System of Financing Long-Term Services and Supports for Older Americans, from the Summer 2017 issue of The Journal of Retirement, authors Mark Warshawsky and Ross Marchand (then both with the Mercatus Center at George Mason University) explore possible weaknesses of the existing framework under which seniors can qualify for long-term services and supports (“LTSS”) under Medicaid. They explain that aspects of the eligibility criteria in certain states allow seniors to draw on the Medicaid resources even if they have sufficient resources to pay for their care. The authors also discuss how states with mandates to recover assets from deceased Medicaid recipients have a poor track record of doing so. The authors assert that the market for long-term care insurance (“LTCI”) is being depressed by the ability of seniors to qualify for Medicaid LTSS benefits even when they can afford private LTCI. The authors offer several policy recommendations, including tightening Medicaid eligibility standards, narrowing the “primary residence” exclusion, and implementing a more robust estate recovery scheme.