One of my father’s favorites was “Talk’s cheap, takes money to ride the train.” Financial priorities must now be drastically changed. Institutional care business as usual must be served a cease and desist order. COVID took no prisoners, over half of all deaths in countries around the world took place in a nursing home. The pandemic vividly exposed the lack of care in institutional settings. COVID has reshaped many social interactions worldwide from a global glut of office space to further exposing the truth about the lack of care in nursing homes in countries all around the world. It has been suggested that very little nursing takes place and frequently it would be hard to describe these facilities as anything resembling a home.
Obviously, for those who have a home or the living family support necessary, to establish universally desirable alternate home care would be the unequivocal truth at the heart of all conversations about assistance with ADLs and IADLs. Nursing homes have unfortunately long held a less than stellar reputation for quality of care. Care quality is policed by the government in the United States, Medicare and Medicaid, hopefully guided by consumer choice with an established ironclad commitment to quality. Home and community based care is already driving the bus. Currently 65 percent of caregivers are a spouse or children. Shortages in the quality of institutional care in America are being exacerbated by increasing mortality, many living into their 90s and children who in the past might have succumbed to premature births or medical complications are increasing the number of those who will need disability care.
Currently Medicaid spends 57 cents of every dollar of HCBC, however only 15 percent of those receiving those dollars are over 80. More importantly, as a percentage of those receiving care at home in relation to overall, health expense is among the lowest in the world with America spending only five percent. The average in the world is three times that amount. We cannot keep throwing discounted dollars, meaning knowingly insufficient funding, at a problem that is about to explode. I am among the oldest Boomer generation. Thank God I am facing that aging certainty with a paid-up comprehensive TQ long term care indemnity policy. I will, of course, struggle with the notion that not all who read this column have already put their own protection plan in place. And I will not over excite my blood pressure by even remotely thinking this conversation is not a sacred component of every agent’s fiduciary responsibilities.
Maybe we could all agree to make just one change. Think small! Even those states beginning to mandate a payroll tax are only creating $50,000 plus of financial support. The truth is $50,000 can provide substantial support, particularly if that support takes place at home. Average claims are between two and three years and 50 dollars per day would certainly strengthen a well-managed HCBC plan. I don’t think the industry could make it any easier to add a rider which only gently affects a life sale pricing, again focusing on a small step but always in the right direction.
Please do not misunderstand. The government must now make this a national priority like a war on drugs or poverty. The private insurance industry can continue to aid and supplement a newly enhanced focus to augment quality care in an HCBC environment. There are those who have always claimed we may have originally bit off more than we could chew. If we can increase sales by thinking small, we reduce underwriting friction, decreasing cost and accelerating access, again by thinking small and accomplishing achievable goals. It has also been strongly suggested that HCBC needs to think small, creating a much smaller setting for care to take place. The “Small House” care experiments are showing great promise.
Thinking small may finally create a basis for sustainable sales success. We may again reclaim the middle class as our own. We may escape some of the restrictions of pre-existing underwriting taboos. We may give carriers the optimism of some reserve restraint, growing policies under management with reduced manageable risk.
I can’t believe I’m saying this but please let us Think Small!
Other than that I have no opinion on the subject.
