September 13, 2016
Edmond G. Brown Jr., Governor
State of California
State Capitol, Suite 1173
Sacramento, CA 95814
RE: SB 1384 (Liu) – Sign
Dear Governor Brown:
California Health Advocates (CHA) is a not-for-profit organization dedicated to providing quality Medicare and related healthcare coverage information, education and policy advocacy. California Health Advocates supports the work of local Health Insurance Counseling & Advocacy Programs (HICAP) which provide benefits counseling and community education on Medicare and long-term care.
CHA has for decades actively participated in supporting enhanced consumer protections in long-term care insurance and supporting the California Partnership for Long-Term Care in California. We were an original participant in the formation of the Partnership program and have been chosen as a consumer representative to the National Association of Insurance Commissioners since the inception of that program in 1992. We understand the public policy dilemma of financing long-term care and the strain on public resources. While we believe that insurance will always play a role in financing care, it will not provide the only solution for financing this kind of care.
The insurance marketplace overall is in disarray following the imposition of enormous premium increases and companies fleeing an unprofitable market, leaving behind consumer mistrust and damaged company reputations. The collapse of this product line will not be revived without a major effort and retooling and it will not happen quickly. In the meantime we must all work together to find solutions for funding long-term care. SB 1384 (Liu) offers a unique opportunity to begin that process through an inclusive process with various stakeholders that was the foundation for the original Partnership program.
Moderate income Californians pose the greatest risk to the state Medicaid program if they need long-term care they can’t pay for after exhausting their limited assets. We believe that SB 1384 (Liu) provides a vehicle to begin rebuilding the Partnership program to meet the needs of moderate income people who most need benefits to avoid or delay dependence on public resources.
We recognize that long-term care insurance cannot address the needs of every Californian. But for those moderate income people who are most likely to spend all their assets if they need long-term care the Partnership offered them insurance coverage and some limited protection against the depletion of all of their assets. That program is now in jeopardy and in danger of ultimate collapse with only one company remaining in the Partnership program. The program could be retooled and redesigned through a deliberative, inclusive process to ensure that moderate income Californians have access to benefits that are suitable to their needs and finances and that companies are willing to sell.
The original advisory group was composed of stakeholders including agents, companies, state agencies, and consumer groups to ensure a strong working program and high quality products. Over the two decades since the introduction of the Partnership insurance products have evolved, new types of services have appeared, newly invented electronic sensors and monitors are available, and with the appropriate assistance and planning more people are able to remain at home when they require long-term care. An advisory group can assist the Partnership program in redesigning benefits geared to an evolving system of care, utilizing new products and services that will assist caregivers in keeping family members at home and out of higher cost care facilities where they are more likely to exhaust their benefits more quickly.
We recommend that the advisory group be reconstituted to consider and recommend changes that are needed in the products, benefits, and benefit packages, and to ensure that consumer protections are maintained. We encourage you to sign SB 1384 that can be a win for consumers and a win for the state in delaying access to public benefits.
For California Health Advocates
CC: Senator Carol Liu; Jennifer Kent, Director, Department of Health Care Services