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Baucus Bill Calls Attention to Long-Term Care Insurance

MacKenzie Kimball, for HealthLeaders Media, September 21, 2009

Many of the provisions outlined in Senate Finance Committee Chairman Max Baucus' healthcare plan, America's Healthy Futures Act, are attracting scorn from conservatives and left-wingers alike, with each party claiming the bill does not sufficiently address enough of its own demands.

The Montana Democrat sought to draft a plan through negotiations with members from each side of the aisle. The goal: A viable, lower-cost healthcare reform option that includes at least a few GOP strokes in what was to be overall, a liberal big-picture initiative. The attempt to please both sides, however, may have cast qualms over the entire piece of legislation.

Yet there are certain provisions that have gained positive attention and support from the long-term care industry. Early in the roughly 220-page bill, Baucus lays out his proposal for long-term care insurance, which includes a cafeteria plan, "a vehicle through which small businesses can provide tax-free benefits to their employees," according to Jesse Slome, executive director of the American Association for Long-Term Care Insurance.

The change, he says, will ease participation restrictions and help boost the growing employer market. At the moment, the majority of the long-term care insurance market is made up of individual buyers, but Baucus' provision will help shrink the difference, Slome says.

"I think it's very positive," he adds. "People keep hoping for an above the line tax deduction across the board at the federal level, but the economy just can't support that at this point. So this is really the best that the industry is going to get."

If passed, this long-term care insurance provision could create a huge boom for the growth of employer-sponsored plans, whether they are voluntary or paid for, to some degree, by the employer, Slome says. "That creates increased awareness. That gets more people covered and we've got to get millions more people covered for multiple reasons, most importantly so they don't become dependent on the government."

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