Editorial: Boomers unready for long-term needs

  • Updated: March 26, 2012 - 8:42 PM

Poll finds Minnesotans aren't planning for future health care.

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The sobering preparedness gap revealed by a new poll on long term care in Minnesota spotlighted one of the most pressing concerns of this era -- how to pay for aging baby boomers.

The leading edge of this demographic tsunami is just hitting their mid-60s. Those who reach this milestone age have about a 70 percent chance of needing some kind of long term care in the decades ahead.

Yet Minnesotans are breathtakingly unprepared to pay for the help many will need -- a finding that should galvanize legislators to find and swiftly implement solutions instead of giving this topic short shrift yet again.

Only 19 percent of Minnesotans surveyed said they have private long term care insurance. Most of those polled -- 52 percent -- said they had done no planning. And although 39 percent said they had a plan, many acknowledged that it was basic at best.

The poll was done in December by Momentum Analysis and commissioned by the Long-Term Care Imperative, a collaboration of the state's two leading long term provider associations: Care Providers of Minnesota and Aging Services of Minnesota.

The chasm it found between care needs and individual planning unfortunately comes as no surprise. Across the nation, those shouldering responsibility for long term care have long been a minority.

Few people want to face up to the indignities advanced age can bring, much less plan for them. Many also mistakenly believe that Medicare -- the federal health insurance program for seniors -- covers most long term care costs. (In fact, the 19 percent coverage rate found by the poll is far higher than other estimates, and it may reflect respondents' misconceptions about what Medicare covers.)

Those who do turn to private long term care insurance are increasingly priced out of the market. Premiums soared from 20 to 90 percent in Minnesota this year, according to a March 19 Star Tribune story.

Inaction isn't an option. Long term care costs can top $37,000 annually in Minnesota for care in assisted living. Nursing home care can top $76,000.

Those costs can quickly demolish a lifetime of savings. Medicaid, the state-federal medical assistance program for the poor, will provide for those who have burned through their assets. But making this safety-net program the de facto long term care insurance program for the bulk of the population isn't sustainable.

A Citizens League report estimates that without changes, Medicaid long term care funding in Minnesota would reach $5 billion a year by 2035 -- up from $1.1 billion in 2010.

The uncertain future of the CLASS Act -- a federal attempt to encourage personal long term care savings -- puts the onus on states to innovate. Policymakers should seize this opportunity to tailor solutions that best fit Minnesotans' needs.

Greater awareness of long term care costs is needed. So is an "all of the above" strategy -- tax breaks, more-affordable reverse mortgages, new types of long term care insurance -- when it comes to policy changes that would enable more Minnesotans to take responsibility.

A Citizens League recommendation that would turn Medicaid into a coinsurance program that supplements private insurance -- except for the truly needy -- deserves serious discussion.

So far, one innovative solution -- helping Minnesotans tap into life insurance policies for long term care needs-- hasn't gotten much traction with legislators. The Dayton administration and the state Department of Human Services, however, will soon roll out an "Own Your Future" program to raise awareness and study possible solutions.

The program is an important step forward, but it's just a start. There's much more work to be done to prevent the baby-boomer tsunami from swamping the system.

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  • INNOVATE NOW


    "We can no longer ignore the numbers. Aging Minnesotans, their caregivers and families deserve a dependable plan from our state leaders."


    -From a joint statement by Gayle Kvenwold, president and CEO of Aging Services of Minnesota, and Patti Cullen, president and CEO of Care Providers of Minnesota

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