Re-Inventing Long Term Care

Frankly I’m surprised Howard Gleckman writes such uninspired commentary when reporting about the troubled Long Term Care Insurance business. His report about Genworth’s troubles does not get out of the silo where the trouble lies. Gleckman’s book,  Caring for Our Parents is subtitled, Inspiring Stories of Families Seeking New Solutions to America’s Most Urgent Health Crisis, but his article doesn’t get near any new solution. I guess we won’t find out of the box ideas here!

In this case out of the box is almost literal because the solution lies out of the silo! Gleckman’s final question, meant to be provocative, shows how little he gets it. The reason we cannot rely on LTC insurance is not because it is failing but because it never got out of the ground. Almost no one bought it. It was perceived as a poor investment by consumers and turns out to be a bad investment for the companies selling it. The government only pays for long term care if you are poor, so we will pay for it as we have been, out of pocket. And there-in lies the solution. We must be businesslike in moving forward. And we must do it fast because the one thing Gleckman gets right is that we, the United States of America, is facing a crisis!

Three Points to Reinvent Long Term care

1. Be Holistic- we are not going to solve the crisis through increased savings or purchasing more LTC insurance products ALONE. No business facing difficulty looks only to increasing revenues. Learn from the recession. Businesses that are profitable now sought more efficient operations in addition to more customers and increased revenues. They reduced costs by using real estate and staff more efficiently, looking for better suppliers or deals and streamlining processes. It is not enough to raise more money even if it were possible. We need to make each dollar we can spend go further.

2. Fix all the parts. The caregiver ratio is a large a problem too. Transportation options that don’t work for older travelers is the most often cited issue. Healthcare is so broken geriatrics is essentially non-existant. See Atul Gawande’s excellent Being Mortal indictment of the medical system’s failings. These are just examples, each of which deserves, requires, wholesale rethinking. Then the parts must be streamlined to work as a system that is easy to access and navigate giving caring families and deserving older citizens a customer experience about which our nation can be proud.

3. Treat the house as a tool as well as an asset. The recent Harvard Joint Center on Housing/AARP Foundation report calls housing a linchpin. Older Americans own a lot of real estate. And they want to stay there. Financial planning that does not deal explicitly with where you will live and receive care is irresponsible. We can help everyone- tax payers, business, every level of government and older Americans alike – by incentivizing the preparation of homes as the care sites they will inevitably be.

Priming the economic engine has long history in the US – from railroads, telegraph, power generation, mortgages, business location credits and more – not to mention bailing out the auto industry and banks that are too big to fail. We have a very short window where, for once, we can apply these techniques before the crisis. It is time to match our economic capabilities to problems we can see coming.

This is an opportunity for American ingenuity and entrepreneurship to shine. We have a respected history in business innovations that democratize and herald a new world. There is no better time to make history repeat itself.