Care: A Public/Private Partnership to
Finance Long-Term Care
David J. Guttchent
Introduction
As we prepare for the beginning of the twenty-first century, policy makers are becoming keenly aware that they cannot ig-nore the increasing costs of long-term care as the demographic freight train filled with seventy-three million Baby Boomers, who will begin to reach age sixty-five in the year 2010, pulls into the station. "How Will We Pay?" is a question being echoed through-out the country from the halls of Congress to families' kitchens as our society grapples with the high cost of long-term care.
We, as a nation and as individuals, have done little planning to date for the cost of long-term care. A long-term care financ-ing system has emerged in this country that is patchwork at best and relies heavily on a health insurance program for the poor-Medicaid-as the primary source of government payment. Al-lowing Medicaid to become the default payment option has put individuals in the no-win situation of having to choose between spending their hard-earned savings on their care or giving their money away so as to appear impoverished and, thereby, qualify for the program. In either event, these individuals forfeit con-trol over a lifetime of savings and lose the independence and dignity that is associated with financial security.
Several states, including Connecticut, have attempted to reshape the long-term care financing system in order to provide its citizens with options to pay for their long-term care without impoverishing themselves. In the absence of a national ap-proach or solution, these states have felt an obligation to re-spond to the growing anxiety and concern their residents
t David J. Guttchen is the Project Director for the Connecticut Partnership for Long-Term Care and works for the State Office of Policy and Management where he is also the agency's Long-Term Care Specialist. Mr. Guttchen holds a Masters in Social Work from the University of Connecticut and a Bachelors in Arts from the University of Michigan.
express regarding how they will pay for their own and their loved ones' long-term care. Tighter budgets, both on the federal and state levels, have forced state governments to look for alterna-fives to current long-term care financing systems.
Below is a description of one such option, the Connecticut Partnership for Long-Term Care. This article will explore the background and development of the Partnership program, what it has accomplished to date, and where the future may lie for state-based initiatives such as the Partnership.
Beginnings
In 1986, in response to escalating Medicaid long-term care expenditures and the steady increase in the number of individu-als who "spend down" their assets by paying for their long-term care or transferring their assets in order to access Medicaid, Con-necticut created The Governor's Commission on Private and Public
Responsibilities for Financing Long-Term Care for the Elderly
(Commis-sion), a special Commission to examine the public and private responsibilities for financing long-term care. The Commission was comprised of a broad group of individuals, including lawmakers, state government officials, union and employer rep-resentatives, educators, researchers, insurance industry repre-sentatives, long-term care providers, and consumers. It met for one year and issued its final report in June 1987 titled How Will
We Pay ?1
The Commission examined the issue of long-term care fi-nancing from the perspective of the individual or the family who has to pay for care, as well as from the perspective of the state taxpayer whose taxes are, more and more, devoted to the Medi-caid long-term care budget. In fiscal year 1986-87, the State spent $275 million for Medicaid long-term care expenditures. The Commission projected that the figure would increase to $1.4 billion by the year 2000 if the long-term care financing sys-tem was not changed.2 After numerous public hearings and re-1 STATE OF CONNECTICUT, GOVERNOR'S COMMISSION ON PRIVATE AND PUBLIC RE-SPONSIBILITIES FOR FINANCING LONG TERM CARE FOR THE ELDERLY, How WILL WE PAY?
(1987).
2 STATE OF CONNECTICUT OFFICE OF POLICY MANAGEMENT BUDGET FOR FISCAL YEAR
ports3, the Commission concluded that neither the public nor private sectors alone could adequately address the growing long-term care financing problem. Building on this theme, the Com-mission's major recommendation in its final report was for the State of Connecticut to pursue the development of a public/pri-vate partnership to finance long-term care; an alliance that would bridge the efforts of state government and the private in-surance industry.4
Two major goals were identified for the new initiative. The first was to create a program that would provide Connecticut's residents with a mechanism through which they could plan for their long-term care costs without risking impoverishment. The second was to constrain the growth of the long-term care portion of the Medicaid budget.5
At the same time the Commission's final report was being released, the Robert Wood Johnson Foundation (RWJF), the country's most generous health care philanthropy, was develop-ing a grant program which was to focus on long-term care fi-nancing.6 Connecticut received the first planning grant under RWJF's new initiative to promote long-term care insurance for the elderly. The two year planning grant led to the development of a public/private partnership model that has since become known as the Connecticut Partnership for Long-Term Care ("Partnership"). RWJF awarded planning grants to seven other states7 under the same initiative.
Development of a Model
In order to develop a public/private model that would gain broad support, it was essential that a Policy Steering Committee be created which would represent a wide range of views and per-spectives and establish concrete goals. Building on the experi-ence of the Commission, Connecticut first created a Steering
3 See Governor's Commission on Private and Public Responsibilities for Financing
Long Term Care for the Elderly, supra note 1, Appendices D, G, H, I,J, & K.
4 Id. at 20-22. 5 Id.
6 THE ROBERT WOOD JOHNSON FOUNDATION, THE PROGRAM TO PROMOTE
LONG-TERM CARE INSURANCE FOR THE ELDERLY. The first grant awarded under the Program went to Connecticut in 1987.
7 California, Indiana, New Jersey, New York, Massachusetts, Oregon, and
Committee, under the RWJ-F planning grant, representing the major stakeholders, including lawmakers, insurance companies and consumers.' The Steering Committee then developed a program model that met the dual goals of: (1) providing individ-uals with an option to plan ahead to meet their future long-term care needs without the fear or risk of impoverishment and, (2) creating savings to the long-term care portion of the Medicaid budget. The Committee worked with the help of the University of Maryland Center on Aging, which was funded by the RWJF to oversee the eight state planning grants, and the Brookings Insti-tute, which had developed a long-term care financing simulation model.
The cornerstone of the model was a feature called "Medi-caid Asset Protection" (Asset Protection). This feature would al-low purchasers of specially approved private long-term care insurance policies to keep some or all of their assets, and still be eligible for the Medicaid program if their private insurance proved to be insufficient to meet their long-term care needs. Af-ter many different options were reviewed for cost-effectiveness, the Policy Steering Committee settled on a 'dollar-for-dollar' As-set Protection approach. Under this approach, individual policy-holders could protect one dollar of assets for every dollar of private insurance paid out in long-term care benefits if they ever needed to apply to Connecticut's Medicaid program. While the Medicaid Asset Protection component of the model was of great importance in developing the program, the following equally im-portant goals received significant consideration.
8 The Policy Steering Committee was created by the Office of Policy and Manage-ment (OPM) because OPM was the recipient of the Robert Wood Johnson Foundation grant and was charged by Governor O'Neill to develop the Partnership program. The Policy Steering Committee was comprised of: the Commissioner of the Department of Income Maintenance (now the Department of Social Services); a representative from the Coalition on Aging (a consumer advocacy group); a representative from Connecti-cut Community Care, Inc. (a case management agency); a representative from the AFL-CIO; a representative from United Technologies, Inc.; a representative from a local nursing home; a geriatric physician from the University of Connecticut Health Center; a State Representative; two State Senators; an attorney in private practice; the Commis-sioner of the Insurance Department; a Senior Vice President from the Travelers Insur-ance Co.; the Secretary of the Office of Policy and Management; the Deputy Secretary of the Office of Policy and Management; and a consumer representative.
Program Goals
Five major goals emerged during the development of the Connecticut Partnership model. Below is a brief description of each goal. Later in this article, the manner in which these goals are being met will be explored.
Provide individuals and families with an option to plan for their future long-term care needs without the risk orfear of
impoverishment
The Medicaid Asset Protection feature described above was developed so that private long-term care insurance could ade-quately prevent impoverishment. Medicaid would act as the re-insurer for those purchasing policies under the Partnership program without requiring policyholders to exhaust all of their resources.
Enhance the quality of private long-term care insurance
The Policy Steering Committee felt strongly that if the State entered into a partnership with private insurers, the products be-ing marketed under the aegis of that partnership would have to meet stringent consumer standards in order to boost consumers' confidence in long-term care insurance and to ensure that the policies included the features most often cited as essential com-ponents to a worthwhile plan. This was especially important be-cause in the late 1980's long-term care insurance was in its infancy and the benefits provided in the products being offered at that time were quite limited. The Partnership developed spe-cial standards that insurance companies would have to adhere to in order to be approved under the program.9
Provide public education
Public information and education was viewed from the very beginning as possibly the most important contribution the State could make towards the Partnership program. At the time the 9 The consumer standards developed by the Partnership included, but were not limited to: automatic inflation protection provisions, minimum daily benefit levels, ex-tensive home and community-based benefits including social and medical services as well as case management, step-down coverage for those policies in danger of lapsing, and training for agents and brokers wishing to market Partnership policies.
model was being developed, there was little information being offered by either the public or private sectors on long-term care financing. The Policy Steering Committee recommended that an extensive information campaign be launched and sustained under the Partnership so that Connecticut residents would have access to objective, accurate information they could use to help with their planning decisions.
Make long-term care insurance more affordable
One of the criticisms of long-term care insurance in 1987 which still exists today, is that it is too expensive for most people. A major goal of the Partnership model was to make the
insur-ance more affordable for a greater number of people. Here again, the Medicaid Asset Protection feature was the key compo-nent in reaching this goal. By providing Medicaid as a rein-surer,"° individuals could limit the amount of private insurance they needed to purchase, thus reducing the cost.
Constrain the growth of Medicaid long-term care expenditures
An overriding principle of the planning effort was that the Partnership model reduce the inevitable growth in Medicaid long-term care expenditures. Using long-term care financing simulation models," the State was able to develop a model that in the beginning years was budget neutral and would begin to show savings to the Medicaid program after several decades.
At the end of the eighteen month planning period, a Part-nership model emerged that, on paper, met all the goals de-scribed above. However, three major items needed to be secured before implementation and testing could begin and 10 Excess insurance is additional insurance that begins when primary insurance is exhausted. In other words, someone who purchases excess insurance is buying addi-tional coverage beyond the coverage they bought with a primary policy. Medicaid be-comes an excess insurer under the Partnership since Medicaid will pay benefits after the private insurance policy has paid out its benefits. In this way, by purchasing a Part-nership policy, an individual gains access to excess insurance through the Medicaid program. However, the excess insurance does not cost anything. It is sufficient that the individual purchase a policy that meets the Partnership's standards in order to receive the Medicaid insurance. "Coverage against loss in excess of a stated amount or in excess of coverage provided under another insurance contract." BLACK's LAW DxcnONRxv 803
(6th Ed. 1992)
11 THE BROOKINGS INSTITUTE, ICF LONc-TERM CARE FINANCING SIMULArION MODEL
before the question of whether a Partnership could actually work would be answered.
Necessary Approvals
In order for the Partnership to take the step from the draw-ing board to the real world, three essential components were needed: (1) state legislative approval, (2) funding, and (3) fed-eral government approval. While the first two items were se-cured relatively quickly, the third element proved to be more elusive.
In the spring of 1989, Connecticut's General Assembly unanimously approved legislation that authorized the Connecti-cut Partnership for Long-Term Care as a pilot program to be coordinated by the Office of Policy and Management (OPM).12 The Department of Income Maintenance (DIM) (now the De-partment of Social Services (DSS)), the DeDe-partment of Aging (SDA) (now part of DSS), and the Department of Insurance (DOI) were all given roles as part of this multi-state agency effort.
DIM, through their administration of the Medicaid pro-gram, was responsible for obtaining the necessary federal gov-ernment approvals and providing oversight to the Medicaid asset protection aspect of the program. SDA developed and imple-mented the public information and consumer education cam-paign. DOI developed regulations that would govern the approval of the long-term care policies to be marketed as Con-necticut Partnership policies, reviewed and approved the poli-cies, and monitored and regulated the insurance companies and agents. OPM oversaw and coordinated the implementation of the program and secured the necessary funding to launch the project.
In July 1989, the RWJF awarded Connecticut the first imple-mentation grant1 under their long-term care insurance pro-gram: a three year, $1.8 million grant which would eventually grow to a total of $2.5 million. The third, and last piece of the puzzle, was approval from the federal government.
12 1989 Conn. Acts 89-352 (Reg. Sess.)
13 The Robert Wood Johnson Foundation grant in the amount of $1,799,996.00 was awarded to the State of Connecticut on July 21, 1989.
Medicaid is funded jointly by the state and federal govern-ments. In Connecticut, the State receives fifty cents from the federal government for every dollar it spends on the Medicaid program. Since the Partnership was proposing to amend
Medi-caid rules regarding assets, approval was necessary from the fed-eral government for Connecticut to receive its share of Medicaid expenses from the federal government for individuals accessing Medicaid under the Partnership. Without the 50% federal
match, the Partnership model would not be cost-effective. In 1989, Congresswoman Barbara Kennelly of Connecticut introduced legislation in Congress that would have given ten states the authority to implement Partnership for Long-Term Care demonstration projects.'4 While Connecticut, with State legislative approval and funding in hand, was hopeful that
Con-gressional approval would come quickly, it became apparent there would be a struggle. After two years and numerous public hearings and debate, language authorizing a Partnership dem-onstration project was passed by the U.S. Senate in 1990 as part of an omnibus spending bill.'5 Unfortunately, an agreement could not be reached with the Conference Committee of the House of Representatives, so the Partnership language was not included in the final version of the bill.
While there was widespread support for giving states the ability to develop innovative long-term care financing options for their citizens, such as the Partnership, opposition did exist.16 Those opposing the initiative felt that the Partnership program would inappropriately allow wealthy individuals to access the Medicaid program, a program designed to meet the health care needs of the poor. Connecticut, and the other states interested in securing Congressional approval, argued that, in fact, the Partnership was designed to prevent, or, at a minimum, delay wealthy people from accessing Medicaid. It was generally ac-knowledged at the time that the practice of transferring and
14 H.R. 2499, 101st Cong. 1st Sess. (1989); H.R. Rep. No. 881, 101st Cong., 2d
Sess. (1990), reprinted in, 1990 U.S.C.C.A.N. 2017.
15 The Omnibus Budget Reconciliation Act of 1990 (OBRA '90), Pub. L. No. 101-508, 1990 U.S.C.C.A.N. 2017 (1990 WL 200617).
16 Primary opposition came from Representative Henry Waxnan, who at the time was the Chairman of the House Subcommittee on Health and Environment of the
sheltering assets in order to appear impoverished to gain access to Medicaid was gaining popularity. As a result, wealthy individ-uals were already using Medicaid to pay for their long-term care. The States' arguments were that the Partnership programs would provide an incentive for those who would have transferred assets not to do so, since they could retain control of their re-sources but also be able to utilize the safety net of Medicaid if their private insurance proved to be insufficient. The Partner-ship aimed to make long-term care more affordable and accessi-ble for the low to middle classes, those who had moderate incomes and assets and who were at risk of exhausting (not transferring) their resources. If the Partnership was successful, the State argued, Medicaid's resources could be better targeted to those most in need. The States, however, were unable to lessen the opposition to the Partnership concept and, due to the influence the opposition had in Congress at the time, it became apparent that the legislative route would not provide the timely approvals that the Partnership needed.
With Congressional approval not forthcoming, it appeared that the Partnership projects would not see the light of day. In November 1990, discussions were held with the RWJF regarding the future of the Partnership. Connecticut was given until Janu-ary 1991 to devise an alternative method of securing federal ap-proval or the RWJF grant to the State would be rescinded.
In fact, Connecticut had been exploring another option for federal approval since early 1990. At that time, Connecticut had asked the federal Health Care Financing Administration (HCFA)-the agency that oversees Medicaid-to provide an in-formal opinion as to whether Connecticut could gain federal ap-proval for the Partnership project through an administrative route. That route would be an amendment to the Medicaid State Plan that describes each state's Medicaid program and must be submitted to HCFA for approval.
With the extraordinary cooperation and support of outgo-ing Governor William O'Neill and incomoutgo-ing Governor Lowell Weicker, the State received a letter in January 1991 from HCFA that stated that Connecticut's Medicaid State Plan approach for the Partnership projects would likely be approved and that
Con-necticut should apply formally.'7 This letter was enough for the RWJF to maintain their grant to Connecticut. However, no new staff could be hired and expenditures would be very limited until
HCFA approval was actually secured.
Even with the January 1991 letter from HCFA, federal ap-proval did not come easily. Since Connecticut was the first state to propose implementing a Partnership program with several states waiting in the wings, HCFA embarked on an extensive re-view of Connecticut's proposal. After eight months, HCFA ap-proval finally came.
In August 1991, HCFA officially approved Connecticut's Medicaid State Plan Amendment. Connecticut became the first state to gain permission to link private insurance with Medicaid and develop a Partnership for Long-Term Care. This action opened the way for New York, Indiana and California to receive similar approvals and the RWJF program was on its way to be-coming reality.19
Implementation
With all three necessary elements in hand, the State needed to quickly begin implementing the Partnership program. The Partnership developed and secured approval of the Insurance Department regulations that detailed the strict consumer stan-dards that the insurance companies would have to meet in order to participate under the program.2 0 These insurance regula-tions were the result of a delicate balance of the needs of the State, consumers, and the insurance companies. Through the work of an Insurance Subcommittee of the Policy Steering Com-mittee, the final regulations were a compromise between
af-fordability and consumer protection. The Insurance
Department worked diligently to obtain expedited approval
'7 Letter from Gail R Wilensky, Ph.D., Administrator, Health Care Financing Admin-istration, to Lowell P. Weicker, Governor, State of Connecticut (Jan. 30, 1991) (on file with
the Office of Policy and Management).
18 Letter from Ronald Preston, Ph.D., Associate Regional Administrator, Division of Medicaid, Health Care Financing Administration, Department of Health and Human Ser-ices, to Marta Elisa Moret, Deputy Commissioner, State of Connecticut Department of Income
(Aug. 28, 1991) (on file with Social Services).
19 Of the eight states that received Partnership planning grants, only California, Connecticut, Indiana and New York went on to receive implementation grants.
from the General Assembly which came in October 1991. These regulations were groundbreaking in nature and set a standard towards which all long-term care insurance policies could strive. With the rules of the game in hand, there were still some doubts as to whether the Partnership would ever actually get off the ground. While the insurance industry was involved with and supported the Partnership model since its development stage, the Partnership was still a voluntary program providing no guar-antee that any insurance companies would actually choose to participate. Fortunately, there were. Soon after the Partnership insurance regulations went into effect, three insurance compa-nies (Blue Cross and Blue Shield of Connecticut, The Travelers, and AMEX Life Assurance Company) submitted their policies for review and approval.
In a tremendous example of cooperation among State agen-cies, the Office of Policy and Management, the Department of Income Maintenance, and the Department of Insurance ap-proved all three companies in time for a press conference by Governor Weicker scheduled for December 18, 1991. At that press conference, the first Partnership for Long-Term Care in the country was launched. Connecticut finally began implemen-tation of a program that had its roots all the way back in the 1986 Commission.
In 1993, New York and Indiana launched Partnership pro-grams and in 1994, California became the fourth state to imple-ment a Partnership for Long-Term Care. Just recently, Illinois, though not part of the RWJF grant program, also began a Part-nership program.2'
Unique Aspects
Below is a description of the unique aspects of the Partner-ship model and how these features are helping the PartnerPartner-ship
meet the goals described above.
21 Of the California Partnership for Long-Term Care, The Indiana Long-Term Care Program, The Illinois Partnership for Long-Term Care, and The New York State Partnership for Long-Term Care, only the programs in Connecticut, California,
Special State Certification
One of the goals of the Partnership is to give consumers confidence in the insurance policy they are purchasing. Only Partnership approved policies carry a special "Good Housekeep-ing Seal of Approval" that tells the consumer that the policy has achieved a special certification from the State by meeting the strict consumer standards described below. Research carried out over the last four years by the Partnership found that over 90% of purchasers of Partnership policies considered the "special seal of approval" from the State an important factor in their policy decision.
Medicaid Asset Protection
The Medicaid Asset Protection feature is only available through Partnership approved policies. This feature helps the State meet its primary goal of providing an option for individuals and families to pay for their long-term care without the risk or fear of impoverishment. By allowing policyholders to protect an amount of their assets equal to what their Partnership policy has paid in benefits, the State then ensures that individuals will not
exhaust their resources if their insurance benefits prove to be insufficient to meet their needs.
The Medicaid Asset Protection feature in Connecticut oper-ates under a "dollar-for-dollar" principle. For example, an indi-vidual with $100,000 in assets could purchase a Partnership long-term care policy that will pay $100,000 in long-long-term care bene-fits. Once the policy has paid out its $100,000 in benefits, the policyholder could apply to Connecticut's Medicaid program and Medicaid would allow the individual to keep their $100,000
in assets and, assuming compliance with all other applicable Medicaid eligibility rules, the policyholder could access the Medicaid program to cover their long-term care. Once on Medi-caid, the individual would have to use their income to pay for their care (as do all Medicaid recipients) but would not have to spend any of their $100,000 in assetS.2 2
22 Alternatively, if someone with $100,000 in assets bought a policy that paid $50,000 in benefits, $50,000 of the assets for purposes of Medicaid eligibility would be protected after the policy paid all of its benefits. If they applied for Medicaid coverage, they would have to spend $50,000 of their assets before being eligible but once they did,
Greater Affordability
Through the Partnership, Medicaid becomes the excess in-surer23 helping the state meet the goal of making long-term care insurance more affordable. In the absence of the Partnership, potential purchasers of long-term care insurance are advised to purchase enough insurance to meet their potential needs, that is, approximately three years of care or, to be certain the insur-ance does not run out too soon, five years of care or care for an unlimited time. The cost of these policies is typically too expen-sive for the average person.
Through the Partnership, individuals need only purchase an amount of coverage commensurate with the assets they wish to protect instead of coverage for the unknown number of years for which they might need insurance. The Partnership provides a rationale for purchasing smaller amounts of coverage since Medicaid, as excess insurer, pays for care once the private insur-ance is exhausted. Therefore, as with the example of someone with $100,000 in assets, they need only purchase that amount of insurance. This would be the equivalent of approximately two years worth of benefits. A policy of that length would certainly be less expensive than one covering three years or more. The Partnership can, therefore, make long-term care insurance more accessible and affordable for a broader range of
individuals-especially for the middle class, its primary target group. Enhanced Insurance Standards
A major goal of the Partnership is to enhance the quality of long-term care insurance policies being sold. Through the In-surance Department regulations, the Partnership has mandated
that certain essential features be included in every Partnership policy to ensure that individuals are purchasing adequate, mean-ingful benefits.
For example, the Partnership requires that all policies in-they could access Medicaid and protect the other $50,000. Keep in mind that Partner-ship policies are required to inflate the benefits of the policy on a compounded basis each year at a rate of 5% per year. Therefore, in this example, if the person purchased $50,000 in benefits but didn't use the policy for 14 years, the policy would be worth $100,000 by this time and would protect up to the full $100,000 in assets.
clude automatic, compounded inflation protection.2 4 This fea-ture is probably the most important component of a long-term care policy, separate from the eligibility trigger and actual bene-fits. Since long-term care insurance is the type of coverage which may not be used for twenty or more years, the benefits of the policy must make some effort to keep pace with the inevita-ble inflation that will occur with the cost of care. Without an inflation protection feature, a policyholder may find themselves actually exhausting their resources paying the difference be-tween their insurance benefit and the actual cost of care.
The Partnership also requires that participating insurance companies offer applicants the opportunity to purchase a wide array of home and community-based services that include not only the skilled services of a nurse or therapist but also support-ive services such as those of a homemaker and adult day care.2 It is these supportive services that are often overlooked and are essential if someone is to remain at home safely. The Partner-ship also requires that the home care benefit include case man-agement services to help the individual and family identify and manage the care that is needed.26
The Partnership has also influenced the quality of all long-term care insurance policies sold in Connecticut. One example involves the Partnership's prohibition, included in its original regulations developed in 1991, against provisions that require the policyholder to be in a hospital or other institution, such as a nursing home, before the policy would pay benefits.27 Identify-ing this Partnership standard as important, the Insurance De-partment included this measure in the regulations governing the sale of all long-term care insurance policies in Connecticut when the regulations were revised in 1994.
The examples above are just a few of the strict consumer standards the Partnership has required of its participating insur-ers. The Partnership has also developed "Standards of Excel-lence" which are features not included in the regulations, but that the insurance companies are encouraged to include in their
24 CONN. AGENCIES REGS. § 38a-475-4(c) (3) (1991). 25 CONN. AGENCIES REGS. § 38a-475-4(c) (2) (1991). 26 Id.
policies.28 These "Standards of Excellence" are a recognition that not everything is best dealt with through the regulatory pro-cess. Through its unique policy review process with both the Of-fice of Policy and Management and the Insurance Department, the Partnership has been successful in working with insurance companies as partners to go beyond regulations to help reach the goal of having the best quality policies available.
Public Education
As mentioned above, another major goal of the Partnership is providing information to the public about long-term care fi-nancing and the Partnership program. The Department of So-cial Services (DSS) oversees a public information campaign that includes a packet of easy-to-read publications, a toll-free informa-tion hotline, trained volunteers available to meet with individu-als and families around the state, and a series of Public Forums in various communities.29
In addition, the Partnership holds presentations through-out the state at the request of a variety of groups and organiza-tions. It also devotes significant resources to publicizing the issue of long-term care financing and the importance of plan-ning ahead. In this regard, the program works with the print and broadcast media to help educate Connecticut residents and inform them about the availability of the Partnership's services.
Cost-Effectiveness
Clearly a primary goal of the Partnership is to constrain the growth of the long-term care portion of the Medicaid program. The Partnership is projected to produce savings of 6.8% in Medi-caid long-term care expenditures by the year 2020. By today's standards that would result in approximately $70 million in sav-ings a year. By encouraging more people to privately insure and reduce the levels of impoverishment and asset transfers, the Part-nership can make a significant contribution to controlling the growth of Medicaid long-term care expenditures.
28 OFFICE OF POLICY AND MANAGEMENT, CONNECTICUT PARTNERSHIP FOR LONG-TERM CARE STANDARDS OF EXCELLENCE (1991), amended, 1997.
29 The Connecticut Partnership for Long-Term Care Public Information and Con-sumer Education Campaign, 1-800-547-3443.
Status and Growth of the Program
Sales of Partnership approved policies by the first three companies began in April 1992. Since that time, the number of participating companies has grown to nine." More than 3200 Connecticut residents have purchased Partnership policies; over 35,000 people have received information on the Partnership and long-term care financing through the program's consumer in-formation service; more than 2500 insurance agents and brokers
have completed the Partnership's seven-hour certification train-ing required for all agents and brokers wishtrain-ing to sell Partner-ship approved policies.
The Partnership has undertaken an extensive research and evaluation project to measure not only the effectiveness of the program, but also to evaluate how the Partnership affects broader issues related to long-term care financing such as Medi-caid asset transfers and MediMedi-caid 'spend-down.' The Partner-ship, over the past four years, has surveyed those who have purchased Partnership approved policies, those who have dropped policies, those who have been denied policies, and those who have begun to utilize their insurance benefits. In ad-dition, the Partnership regularly surveys individuals who receive services through the program's consumer information services. This research component has helped the program to identify
those aspects of the project that work and those that do not, as well as to provide insights on how to improve the program.
The Partnership's public information campaign has ex-tended beyond the traditional educational endeavors, such as presentations and publications, and branched into the public re-lations arena. The Partnership has learned that in order to ade-quately educate the public about such a complex and emotional issue as long-term care, it needed to rely on more sophisticated means of getting peoples' attention. The Partnership has effec-tively used the print and broadcast media to reach large num-bers of Connecticut residents, initiated several direct mailing campaigns to targeted communities, and developed conferences and seminars for financial planners and employers.
30 Bankers Life and Casualty, CNA Insurance Companies, GE Capital Assurance,
John Hancock Mutual Life, Mutual of Omaha, New York Life, The Travelers, UNUM Life Insurance, and Washington National Insurance.
The Partnership has also been proactive in extending its al-liances beyond the insurance companies participating in the program. The program has learned that insurance agents and brokers, as well as other financial professionals, such as financial planners, elder law attorneys, and accountants are the most ef-fective people in carrying the message of the program. The Part-nership has worked extensively with these financial professionals through training sessions, seminars, regular mailings, and the development of specialized publications creating a true partner-ship where all participants can be helped to reach their goals.
Successes
In addition to the growth in participation by consumers, in-surers, agents, and the number of people whom the Partnership has reached through its educational efforts, the Partnership has proved successful in showing that the private and public sectors can work together. While in any partnership there are bumps in the road, the Partnership has been able to smooth out those bumps and develop a unique working relationship between the public and private sectors.
In addition, the Partnership has shown that different State government agencies can work together toward a common goal. While this may not appear to be a significant accomplishment, it is often difficult to secure and retain cooperation across differ-ent agencies and garner the resources necessary from all in-volved. This accomplishment has been made more difficult to maintain since the Partnership is now operating under its third gubernatorial administration.
Further, the Partnership has shown it can change in an ef-fort to improve the program. In 1996, based on feedback re-ceived from insurance agents and consumers, the Partnership proposed, and the General Assembly unanimously approved, sig-nificant changes to the program which will ultimately benefit the State, consumers, and the insurance industry.3' In addition, in 1994, the General Assembly unanimously approved the continu-ation of the Partnership program beyond its pilot status and made it a permanent program.32
31 1996 Conn. Acts 96-131 (Reg. Sess.). 32 1994 Conn. Acts 94-167 (Reg. Sess.).
While it took six years for the Partnership to be developed, approved and implemented, the program continues to develop and change in response to the changing political and economic environment. The Partnership is a good example of the fluid process of public policy development and the importance of cre-ating flexibility in the public and private sectors in order to be able to react adequately to changing situations.
Conclusion
The Partnership has faced many obstacles in its develop-ment and impledevelop-mentation. It is always difficult to develop a pro-gram, especially one as novel as The Partnership. Moreover, the topic of long-term care is a difficult one to tackle. Many people do not want to face the realities of long-term care and the possi-bility they may someday be in need of such care. The Partner-ship worked hard to develop an educational program that gets people to go beyond their denial and fears so that they can edu-cate themselves and make reasonable decisions for themselves and their families. In addition, the Partnership had to struggle with the inevitable problems of any partnership, but the problems were especially acute because this partnership is
be-tween the public and private sectors.
In spite of some of these obstacles, the Partnership's future looks bright and awareness of long-term care insurance is on the rise. Recent tax incentives passed by Congress will help to make the issue more prominent.3" The Partnership is working with other states in an effort to develop a National Partnership for Long-Term Care. 4 Even the British Government is exploring the development of a Partnership for Long-Term Care for the entire United Kingdom.
The Partnership was not developed as, and can never be, a panacea for the long-term care financing problems that Con-necticut and the country face. Other options need to be devel-oped or enhanced for those too poor, sick or old to purchase long-term care insurance. However, the Partnership can make significant contributions by educating Connecticut residents
33 The Health Insurance Portability and Accountability Act of 1996, Pub. L. No.
104-91, 110 Stat. 1936 (West, 1997).
about the importance of planning ahead for their long-term care needs, reaching younger people who have more choices avail-able, and providing them with options such as quality long-term care insurance approved by the Partnership. These contribu-tions are important for the future of the project.
The Partnership is an example of how the public and pri-vate sectors can work together towards a common goal. While it is too early to judge the ultimate success of the Partnership, the program has already set a standard for cooperation among state agencies and between the public and private sectors that can be utilized to assist other similar efforts.
