The Other Insurance

An overwhelming majority of Americans who live to 65 will eventually require long-term care, but less than 10 percent over the age of 50 have long-term care insurance. Those familiar with nursing homes and home-health aides know that such care doesn’t come cheap: National spending on long-term care topped $206 billion in 2005, according to Georgetown Univer sity’s Health Policy Institute. “Virtually the entire U.S. population is at some risk of using more care than their assets can finance,” write Duke public policy professor Donald H. Taylor Jr. and his coauthors.

Advances in genetic screening may upend how long-term care is financed. Taylor and colleagues found that when people learned they had a genotype that increased their likeli hood of developing Alzheimer’s disease, which sends 75 percent of sufferers to nursing homes, they were 2.3 times more likely to acquire long-term care insurance. The problem is that the availability of such genetic tests could flood insurance companies with more high-risk customers, undermining the financial logic of insurance. To contend with a pool of sicker clients, long-term care insur ance providers would either have to raise the premium costs for high-risk individuals or raise all premi ums. In either scenario, the increase would likely make insurance too costly for some individuals.

In order to prevent health insurance organizations from raising premiums for people with a genetic predisposition to disease, Congress passed the Genetic Information Nondiscrimination Act in 2008. But no such restriction applies to long-term care insurers. A few states have stepped in with anti-discrimination laws of their own. But if such safeguards become more expansive, Washington will face pressure to intervene, the authors write, either by requiring everybody to buy long-term care insurance or by providing costly subsidies to cover a greater number of people. Given the legislative circumlocutions that imperiled health care reform, the path forward for long-term care insurance seems murky indeed.