Washington State House of Representatives Office of Program Research | BILL ANALYSIS |
Appropriations Committee |
HB 2777
This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent. |
Brief Description: Concerning a study to determine the feasibility of coverage for long-term care services and support needs.
Sponsors: Representatives Tharinger, Jinkins, Appleton, Ryu, Fitzgibbon, Ormsby, Pollet and Morrell.
Brief Summary of Bill |
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Hearing Date: 2/10/14
Staff: James Kettel (786-7123).
Background:
Long-term care insurance is an insurance policy, contract, or rider that provides coverage for at least 12 consecutive months for the covered person. Long-term care insurance covers services such as home health care, nursing home care, and care in an assisted living facility.
Life insurance is a contract between an individual and an insurer that specifies a premium payment from the individual to the insurer. In exchange for the premium payment, the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured individual, terminal illness, or another trigger specified in the contract.
An annuity is a contract between an individual and a financial institution that allows the individual to make an initial investment, and then create a repayment schedule for the initial investment, with interest, over a specified amount of time.
Medicaid life settlement is the sale of a life insurance policy by a policy owner. Proceeds from a Medicaid life settlement may be larger than the surrender value of the policy, but smaller than the face amount of the policy.
A health benefit exchange is a marketplace that offers health plans for purchase by individuals, families and small businesses. The health benefit exchange in Washington is called Washington Health Plan Finder.
Within the Department of Social and Health Services (DSHS), the Aging and Long-Term Support Administration (ALTSA) administers the Long-Term Care (LTC) program. Long-term care is budgeted at $3.8 billion total ($1.8 billion General Fund-State) to serve roughly 60,000 clients during the 2013-15 biennium. Long-term care accounts for about one-third of the DSHS budget, and 6 percent of the overall state operating budget. Most of the LTC budget pays for personal care, and other community based client services, that are primarily funded by state and federal matching funds (i.e., Medicaid). The institutional-based Medicaid entitlement program in LTC is the nursing home, or skilled nursing facility program.
Summary of Bill:
The DSHS must contract for a study of public and private options for leveraging private resources to help individuals prepare for long-term service and support needs. The study should model at least three options, including: (1) a public long-term care insurance benefit, (2) regulatory changes that would encourage new products on the insurance market, and (3) a new marketplace for long-term care insurance policies. The report must include an evaluation of expected costs and benefits, anticipated number of participants, projected savings to the state Medicaid program, legal risks, and financial risks.
The Joint Legislative Executive Committee on Aging and Disability must provide oversight for this study, and must convene interested stakeholders to provide input on study design. DSHS must submit a report of findings and recommendations to the relevant policy and fiscal committees of the Legislature by January 15, 2015.
Appropriation: None.
Fiscal Note: Requested on February 8, 2014.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.