A federal program proposal aims to assist individuals who cannot afford long-term care insurance.

• For many Americans, finding affordable long-term care is a challenge.
• At some point, approximately 7 out of 10 people will require that level of care.
• One congressman proposes a federal program to assist families in managing expenses.

Finding affordable long-term care is a challenge as the baby boomer generation reaches retirement age.

A major storm is expected to hit our country, and many people who are unable to take care of themselves will be affected, according to Rep. Tom Suozzi, D-New York, who spoke at the Employee Benefit Research Institute policy forum in Washington, D.C. on Thursday.

Suozzi's family cared for all four of his grandparents while they were growing up.

Suozzi's parents were inspired to purchase long-term care insurance after having that experience. Thanks to those policies, both of his parents lived into their 90s and were able to remain at home, he stated.

Now, that same insurance coverage is out of reach for many Americans.

""Long-term care insurance is no longer affordable for people, as insurance companies failed to anticipate the increase in life expectancy, resulting in significant financial losses," Suozzi stated."

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He stated that nursing homes and Medicaid are not adequately prepared to handle the issue.

Suozzi plans to reintroduce a bill called the WISH Act, which proposes the creation of a federal fund for catastrophic long-term care to help older Americans age at home.

In 2021, Suozzi presented a bill that proposed long-term care benefits for individuals who have reached retirement age and are disabled, have severe cognitive impairment, or are unable to perform at least two activities of daily living.

To receive benefits from programs like Social Security and Medicare, Americans must contribute through a payroll tax.

Based on the 2021 proposal, Suozzi stated on Thursday that the amount of benefits received would be approximately $3,600 to $4,000 per month for personal assistance services for six hours per day.

Delays for care coverage would be determined by income, with higher income individuals facing longer waiting periods.

A 'tough sell' to raise taxes

Admittedly, the proposal could face hurdles to gaining support.

Suozzi stated on Thursday that the challenge lies in the fact that no one wants to increase taxes for any reason.

It is challenging to convince people about the necessity of a long-term care tax, as not everyone will require these benefits, according to Ben Veghte, director of the WA Cares Fund, who spoke at the EBRI conference on Thursday.

The WA Cares Fund is a public long-term care insurance program for Washington workers, funded by a 0.58% tax on employees' gross wages.

Veghte estimates that 7 out of 10 individuals will require long-term care during their lifetime. However, this frequently leads people to question the fate of the remaining 3 out of 10 and why they must pay taxes for benefits they may never utilize.

In the upcoming decade, several states, including California, New York, Massachusetts, Pennsylvania, and Minnesota, will likely establish long-term care programs similar to Washington's, according to Veghte.

Veghte stated that once the private insurance industry sees the demand for supplemental products, it is likely to start offering them.

""Addressing the costs associated with long term care and the crisis ahead of us requires the collective effort of private industry, government, employers, and family caregivers, as we understand that the cost is more than just financial," Veghte stated."