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Oct 15th, 2013

A commission to address the long term care financing issues in Maine met for the first time on Friday and discussed the state’s long term care system, which legislators say is “on the brink”.

Evaluation of Care System

The Long-Term Care Facilities Study Commission was created this past Spring after a long term care facility closed in 2012 and numerous bills related to long term care were presented to the legislators.  The Commission is tasked with evaluating the accessibility, costs, staffing, and reimbursement of the almost 130 long term care facilities across the state that serve Maine residents.

Coupled with the rising cost of long term health care services, these aspects of care present a looming disaster for those who are set to retire soon. Long term care is an especially pressing issue in Maine, which has the highest median age of any state and the second highest percentage of seniors, behind only Florida.

The Atlantic Rehabilitation and Nursing Center, located in Calais, Maine, closed its 52-bed facility in July of last year after an inability to keep the organization afloat monetarily. Around 90% of Atlantic’s residents were enrolled in MaineCare, which put the facility under a great deal of economic strain due to low reimbursement rates and tight budgets. The nursing home tried to shift the cost burden onto the private pay patients, but in the end, that still wasn’t enough.

According to Rick Erb, who represents Maine nursing homes and assisted living and residential care facilities as a commission member, the state’s Medicaid program  paid nursing homes $29.4 million less than it cost them to provide care in 2011. Cuts in other social programs, he says, haven't helped.

"Over the last five years we've seen, actually, reductions in Medicare rates… the problem is that it was always subsidizing Medicaid," explained Erb.

Finding a Way to Pay

These cuts in Medicare have left some nursing homes, especially those in rural areas, without much assistance in terms of paying for care. Many people are unaware that the costs are too high to pay out of pocket until they are in a situation where they need care. By then, it is too late to plan or save. Long term care in Maine is significantly more expensive than the national average, as well, and a private room in a nursing home costs more than $100,000 annually. The high cost of care explains why such a high percentage of nursing home residents are enrolled in Medicaid, and the state commission’s job is to develop a solution to this growing problem.

Unfortunately, as we saw with the Federal Commission on Long Term Care, the costs of these services are entirely too high to address in one fell swoop. The CLASS Act, the federal government’s attempt at a national long term care insurance program, was eventually deemed “unsustainable” for this very reason. Unless the price of health care stops climbing each year, no new insurance system will be able to absorb the massively high costs, especially at a time when other federal social programs are suffering.

aine’s commission, much like the federal one, is working on a tight schedule. The group must submit their report and proposals to legislators by December 4th , and there are only 4 more meetings in between now and then. With less than two months left, it remains to be seen whether any groundbreaking new idea will emerge. However, the existence of the commission itself raises awareness about the huge threat that long term care poses to our economy and helps shed light on the various influencers of cost and quality of care.

Avoid Asset Exhaustion

Encouraging people to look into options while they are young will help decrease the number of people who are forced to spend through their assets just to apply for Medicaid and receive care. Planning ahead for retirement, and including long term care costs in your plans, can ensure that you are not shocked and scrambling to find a way to cover the costs when the time comes.

Long term care coverage offers consumers a way to pay for their expensive care at a fraction of the price. A long term care policy will ensure you receive the care you deserve if you ever need custodial or medical care down the road. Read more about long term care insurance or request a comparison of the top companies today.

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