Article on the 2010 MIPPA Legislation
Unfunded health relatedcosts are the greatest financial uncertainty facing the baby boom generation asthey enter retirement years. The vast majority of those costs will relate tohome and institutional based health care services provided in the last monthsof their lives. When presented with the choice of receiving suchend-of-life care in a home based setting versus an institutionalized setting,almost every senior will opt for home based care. Prior to 2010, the Medigap at-home recovery benefitcovered expenditures incurred in connection with in-home skilled medical care covered bya Medicare policy, such as personal care services that many seniors requirein order to avoid a nursing home stay. The at-home recovery benefit waseliminated by the Medicare Improvements for Patients and Providers Act (“MIPPA”)in 2010. The Supreme Court took a decidedly different approachregarding access to home based health care options for this Medicaid-eligiblesenior population in Olmstead v. L.C. ex rel Zimring. The Olmstead decision acknowledged the long standing biastoward providing end-of-life health care services in an institutionalizedsetting, typically a nursing home, and, in an effort to have more of theseMedicaid services provided in-home, required that “public entit[ies] . . .administer . . . programs . . . in the most integrated setting appropriate tothe needs of qualified individuals with disabilities.” Through this “integrated care” mandate, the Supreme Courtrecognized that the unjustified segregation of poor seniors in institutions wasdiscrimination and that home and community based services (“HCBS”) care optionsmust be provided where appropriate and reasonable in light of the patient’sneeds. However, it is the engrained nursing home bias thatnon-Medicaid-eligible middle class boomers are likely to fall victim to,despite their stated intentions to the contrary.
Because administering end-of-life care in a nursing home setting hasbecome the default in the United States, today current retirees who fail tomake affirmative decisions about how and where their end-of-life care will beadministered will have little choice but to receive long-term care in an institutional setting. Failure toaffirmatively engage in planning for end-of-life care choices is often simply abyproduct of limited information and even less professional guidance availableregarding such decisions. This article seeks to explore what lessons can belearned from how Medicaid end-of-life health care services are provided to thepoor post-Olmstead, and how these lessons can be applied to middle class andupper middle class boomers. The article equally seeks to address how suchlessons can be integrated into a meaningful dialogue with retiring boomers in afashion that encourages discussion and decisions regarding end-of-life healthcare, as opposed to leaving such tough calls for surviving adult children.
To this end, Part II of this article begins by examining the hurdlesseniors face in accessing HCBS after the defunding of the Medigap at-homerecovery option in 2010, taking into account the difficulties involved inplanning for long-term care that are caused by significant cost variancesdepending on the community in which the care is provided. This section further explores the impact of informal careprovided by family members on the cost and effectiveness of long-term careperformed in the home.
Part III provides a summary of the historical background of long-termcare in the United States and explores the genesis and perpetuation of the biastoward providing end-of-life care in an institutional setting, despite the highcosts of nursing home care, leading up to the integrated care mandate handeddown by the Supreme Court in Olmstead. In Part IV, the varying degrees to which states haveimplemented the Olmstead mandate are examined to provide an empirical analysisof the cost-savings and reduction in nursing home admission rates that can berealized through effective and widespread implementation of HCBS programs. Spending on long-term care in states with underdevelopedHCBS programs is compared to expenditures in states offering comprehensiveprograms to determine the overall effect of increasing access to HCBS.
Part V identifies the planning gap that exists because ofthe reluctance of both advisors and clients to discuss end-of-life care. This section recognizes the often-conflicting motivationsof financial advisors and attorneys, as well as the disinclination of clientstoward discussing the end of their lives, both of which can lead to a jointfailure to develop effective strategies for funding end-of-life care.
Part VI aims to encourage advisors and clients to ignite the dialogue onend-of-life planning. It discusses the possible imposition of filialresponsibility upon adult children for the long-term care expenses of theirelderly parents and suggests that selective enforcement of filial supportstatutes could promote financial preparedness among baby boomer retirees. Thissection also raises the notion that fiduciary liability may be a motivatingforce that could persuade advisors to initiate the planning dialogue. With bothsides motivated to engage in fulsome planning for end-of-life choices, thisarticle hypothesizes that this planning dialogue can be transformed from onethat advisors avoid and clients recoil from into a conversation that imparts amessage of empowerment and hope among seniors who can develop the toolsnecessary to control the course of their own end-of-life care.