University of Minnesota Long-Term Care Refinancing Committee

(L. Blewett, C.H. Smith, J. Gaugler)

Long-term services and supports (LTSS) encompasses the broad range of paid and unpaid medical and personal care services for older adults and people with disabilities who need support because of age; physical, cognitive, developmental, or chronic health conditions; or other functional limitations that restrict their abilities to care for themselves.1 Care is personal in nature and may be provided in the home, community-based settings, or in nursing facilities. These services may be needed intermittently for several weeks, or for longer periods of time such as months or years. The frequency of this care means it is expensive and potentially unaffordable for many people with low incomes and/or limited savings. 

The costs of LTSS affect us all.  From caring for our aging parents, to helping out an elderly neighbor, to paying for our own services, the costs of LTSS can drain not only the state Medicaid budget, but our own pockets. The costs are enormous and many can quickly spend their savings to pay for needed care.  Large out of pocket costs for health and LTSS create a growing crisis for our rapidly expanding population of older adults and their families. We convened a small group of University of Minnesota faculty and experts in the field to assess various LTSS financing options and make recommendations for policymakers to consider.  Our guiding principles included the following:

  • The solution is multifaceted. There is no “magic bullet” to solve the complex challenge of LTSS financing in Minnesota. We believe multiple options are necessary to address the LTSS care needs of Minnesota across the income spectrum (e. g., Medicaid policy for low-income older persons, individuals with disabilities, employer-based and saving policies for working adults to help them prepare for LTSS costs in the future).   
  • Use state dollars efficiently and effectively. This includes targeting scarce resources to the most vulnerable.
  • Policy options must be feasible and Minnesota-centric. While it’s difficult to predict the future of financing of Medicaid and other health care services, it is important that options are developed with the needs of Minnesota and Minnesotans squarely in mind.  We will look at the activities and programs in other states but develop recommendations that fit Minnesota’s unique characteristics e.g. relatively higher incomes on average, longer life expectancy, good health outcomes, but also persistent disparities in access to care.  Minnesota also has a history of being a leader in the support of home and community based care as alternatives to institutionalized care. 
  • Consider perspectives of multiple stakeholders. To be politically feasible, the opinions of engaged stakeholders should be considered in the development of viable financing options.  Stakeholders will include employers, state Medicaid, Medicare Advantage plans, consumers, providers and their associations to help shape our LTSS financing recommendations.
  • Flexibility for consumers. Options should be meaningful and allow for as much consumer choice as possible.
  • Address the shortage of care workers. For any proposal that increases access to LTSS, policies must include recommendations for addressing the direct care workforce, especially in rural areas.


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