COVID-19 and the Future of Long-Term Care: The Urgency of Enhanced Federal Financing

Abstract

The economic threat posed by responses to COVID 19 endangers financing for long-term care across the states that is already inadequate and inequitable. Increasing the federal share of Medicaid spending as unemployment rises would mitigate fiscal pressure on states and preserve public services. But unlike the demand for Medicaid’s health care protections, which rises when economic activity declines, the demand for long-term care protections will grow even in a healthy economy as the population ages. Enhanced federal support is urgent not only to cope with the virus today but also to meet the long-term care needs of the nation’s aging population in the years to come. Long-term care financing policy should be modified to either adjust federal matching funds by the age of each state’s population, or fully federalize the funding of LTC expenses of Medicaid beneficiaries who are also eligible for Medicare.