For the last two years I have served as Chairman of Citizens For Long Term Care, a non-profit, nonpartisan organization dedicated to raising awareness of long term care issues. We started Citizens in the hope that we could bring together the many different interests involved in long term care into a single coalition that would work together in a coordinated manner to affect long term care financing reform. For the first time representatives for long term care providers and unionized workers; advocates for private insurance and social insurance as well as representatives from the aging and disability communities have agreed to put many of their differences aside in order to try and reach common ground on long term care and more importantly long term care financing reform.

The fact that so many of these traditional and long standing adversaries have agreed to work together ought to indicate to you how important it is that we begin to address long term care issues in a collaborative and nonpartisan manner

What began as an effort to address a significant hole in our social safety net has become more personal as I have been forced to address issues of access, financing, delivery and quality of care for my elderly mother who suffers from dementia as a result of Alzheimer's. For my family, as with an increasingly large number of Americans, the concept of a loved one needing long term supportive care has become a reality.

Despite my experience with Citizens and having worked on health care issues throughout my career my family and I found it to be a confusing, frustrating and bewildering process to go through. Fortunately, unlike millions of Americans, I knew where to turn and who call for answers to help me make sense of the process. Most importantly throughout the process I maintained realistic expectations about my mother's condition; how the systemic failures and inherent problems in long term care would affect her care and our decisions; and, how her economic security would be threatened. It is these three areas that I want to talk about today in order to express the state of long term care in America.

Expectations

Long term care is a tremendously broad term that refers to numerous services that society uses to care for and support people who suffer from disability. It does not matter if that disability is caused by age, chronic disease, mental illness, birth defect or accident; when we talk about long term care we are talking about supportive care for people with disabilities. Yet, we expect different results from care that we provide to people based on the age at which disability occurs.

If a young person needs long term care because of a developmental disability we expect quality, innovative care that will help to improve that young person's quality of life. We seek to support them in a manner that will help them lead an independent life that best develops their abilities. However, if an elderly person needs long term care because of an age related illness we expect only quality custodial care. We see the aging process and long term care as part of an inexorable decline that ends in death. We are not conditioned to expect innovative care that will improve quality of life, foster independence and self sufficiently.

Unlike medical care where we expect dramatic change in condition or sickness we have come to expect that long term care for the elderly means diminished capacity and increased disability because that is what happens when you get old. Long term care does not benefit from the same level of investment as medical care because society sees aging as a unavoidable. We do not invest in or reward innovative care and the professionals involved in caregiving are not valued as equally as those in acute care. We have come to expect less from long term care because it is not something we think can happen to us, or we believe it is something that will not happen for decades. With 45% of the long term care population below age 65 we must contemplate it happening to us any day and we must demand more because it can happen to us at any time. Long term care for the elderly must learn from the disability community that the goal of care is to foster independence and a maximization of one's abilities.

System Failures

To speak of system failures in long term care is somewhat disingenuous because the term long term care system is an oxymoron. We do not have a long term care system in this country; we have a patchwork of services, providers, caregivers and other supports that people must access in times of crisis to help them manage the crisis. The greatest failure in long term care is an antiquated public policy that impedes personal planning, preparation, and decisions. The caregiving and support services of today, as well as the innovative industry of long-term care products, are poised to meet people's needs for independence and interdependence in ways that promote family, home, community, and personal choice if we reform the policy that governs long term care.

The acute medical care industry has been defined by advancements and innovations in care because public policy had placed a primacy on developing policies that help people address their medical needs. People are encouraged and supported in making advanced decisions about their acute care needs. An overwhelming number of people have insurance, a primary care physician, and other important protections against catastrophic medical costs. Public policy does not do the same for long term care.

Too often people are forced to make their decision about long term care in times of crisis. When a loved one is faced with the sudden need for supportive care we find that people are unprepared to address the issues involved. They are unaware of what the most appropriate type of care is, where to get it, what other services might be available, and finally they do not understand how to finance the needed care. Because they have failed to address long term care they have or they assumed it was paid for by Medicare they are forced to make critical decisions in a time of crisis. With 77 million Baby Boomers entering the age when they will become most at risk for long term care it is important that our public policy debates over health care, tax and insurance policy, pension reform, Medicare and Social Security place long term care issues and education as a priority equal to the primacy afforded acute medical issues.

In the late 1980s there was a major shift in health care in America, one that we still have not entirely come to grips with many years later. Beginning in the late 1980s more Americans began dying of the results of chronic illnesses than of acute medical incidents. This fact was due to the advancements made in medical technology, pharmaceuticals and many other factors. Yet as more people began dying of chronic illnesses our care systems, especially Medicare, have failed to adequately address this fact. Failure by the medical system to avoid, delay or reverse the onset of chronic illness has a tremendous impact on our long term care system. It is the people suffering from multiple or a progressive chronic illness that will require long term care. Anything that can be done to keep them healthy will dramatically ease society's future long term care burden.

The greatest failure of the public policy that defines long term care is the current Medicaid based financing system which requires that people impoverish themselves in order to receive financial assistance for their care. Medicaid based financing is an inappropriate use of resources to address an issue that should be integrated into our national economic security discussion.

Economic Security

Throughout the last 65 years America has developed a unique system of social commitments to help people ensure their health and financial security. This combination of income replacement programs, tax supported private insurances and access to health financing programs has helped mitigate the catastrophic financial loss that can occur when an individual or family loses their income or is unable to work due to illness or disability. As we enter the 21st century it is clearer than ever before that this evolving system of commitments has fallen short of its potential when addressing long term care.

Long term care is an essential component of individual and family financial security. At an average cost of $4,500 a month, the cost of even a short stay in a nursing home or other facility has the potential to exceed the financial resources of many Americans. A long stay in a nursing home or extensive use of home and community based resources can and often does consume a lifetime of financial resources. The current Medicaid based financing system dictates that people must effectively impoverish themselves in order to receive government assistance.

The need for long term care is an insurable risk. This means that the risks of needing coverage for catastrophic care are relatively low but the financial consequences are not. As an insurable risk, the most efficient way for individuals to finance long term care is to pool the risks relative to the expected costs. Private long term care insurance and Medicare both pool risks Medicaid does not. Reliance on public assistance as the primary source of financing long term care should be reserved for those whose asset levels necessitate such assistance.

Long term care as an insurable risk is not a new idea, as a member of the United States Senate I was privileged to serve as a Vice Chair of the United States Bipartisan Commission on Comprehensive Health Care from 1989-1990, which concluded that long term care was an insurable risk. Named for Representative Claude Pepper, the nation's champion for the aged and people with disabilities, the Pepper Commission affirmed the need to make significant changes to how we finance long term care. The Commission concluded that welfare based financing was fundamentally flawed; that reliance on savings was inefficient because people had different capabilities; and that the answer to financing long term care was to be found in a system of insurance.

In the 10 years since the Pepper Commission released its report, A Call to Action, our population has gotten older, disability has increased, and care has become more expensive. Yet no one has responded to A Call to Action. Our national debates over Social Security and Medicare reform ignore long term care financing just as most people ignore it in their private lives until a loved one needs supportive care.

In order to significantly improve the delivery, quality, and innovation of long term care we must change how long term care is financed. A rational approach to financing will improve the efficiency and equity of the system, it will recognize people's desire to receive care where and when they need it, and it will improve the quality of care. The system of financing that best achieves these goals is an elaboration of our current employment based economic security system. In order to effectively tap into this system long term care financing issues must be a part of our debates over tax, insurance and pension reform and most importantly the debates over Social Security and Medicare reform.

Conclusion

Citizens For Long Term Care commends you for undertaking this hearing and we hope you will continue to explore the many different components of long term care in the future. This is the first step in beginning the national dialogue that will be critical to educating elected officials and the public at large about long term care's integral part in our financial security system.

Therefore, it is imperative that our nation's leaders, led by the President, undertake a national dialogue with the people to address the size, scope and cost of our commitment to long term care financing. This public dialogue, which must take place as part of our current dialogue on Social Security and Medicare reform is the only way we can educate people about the need and cost of long term care. At stake are the financial security of families and the economic security of the nation.

By developing a national dialogue that recognizes long term care financing reform as an integral part of financial security, we can close the gaping hole in our financial safety net. In doing so, we can develop a financing system that supports an integrated system of care. Such a change would ensure that those not capable of caring for themselves could maintain the highest quality of life, according to their preferences, with the greatest degree of independence, autonomy, participation, personal fulfillment, and dignity.

We have the opportunity to develop a financing system that supports the varying goals of a diverse population with diverse long term care needs. In order to seize this opportunity Citizens commits itself to working with you and supporting your efforts on long term care.

I am happy to answer any questions.