HS810 Unit 10 Policy Analysis Paper Example

Criteria First, Then Options: A Unit 10 Policy Analysis Paper on Financing Long-Term Care for Middle-Income Families

[Student Name]

Purdue University Global

HS810: Advanced Health Policy

Unit 10 Policy Analysis Paper

[Instructor Name]

[Date]

The composite state, its waiting list, options and every local estimate are composite; the federal facts and sources cited are real.

Problem Definition

Long-term services and supports, meaning paid or unpaid help with bathing, dressing, eating and similar tasks for people whose illness or disability prevents them doing these alone, are a large and uninsured financial risk for most families. Federal analysts estimate that about half of people turning 65 will need significant help at some point, with costs that can exhaust savings (Favreault & Dey, 2016). Private long-term care insurance covers few people, and its market has shrunk as insurers raised premiums and left the business. A federal attempt at voluntary public insurance, the CLASS Act, was repealed in early 2013 before it began. Medicaid therefore pays for most paid long-term care, but only after families become poor, and it rations home care through waiting lists (Congressional Budget Office [CBO], 2013). The problem, then, is a financing risk that private markets have largely failed to pool, leaving Medicaid as the payer of last resort.

Criteria and Weights

Five criteria were fixed and weighted before options were developed:

1. Fiscal sustainability, 30 percent. Measure: projected ten-year cost to the state and the stability of its funding source.

2. Coverage of middle-income households, 25 percent. Measure: share of households between 200 and 400 percent of the poverty line who would gain protection.

3. Equity, 20 percent. Measure: distribution of benefits by income and by gender, since women provide most unpaid care and live longer with disability.

4. Administrative feasibility, 15 percent. Measure: whether the state could implement the option with existing agencies within three years.

5. Political feasibility, 10 percent. Measure: support or opposition from key actors and precedent in other states.

Options

1. Expand Medicaid home and community-based waivers to clear the waiting list.

2. A state payroll-funded long-term care benefit modeled on Washington's program, with a lifetime benefit of 36,500 dollars (Long-Term Services and Supports Trust Program Act, 2024).

3. State subsidies for private long-term care insurance premiums for middle-income buyers.

4. Status quo.

Assessment

Option 1, waiver expansion. Fiscal: about 210 million dollars over ten years in state share, funded by general revenue. Coverage: helps those already poor enough for Medicaid, not middle-income families before spend-down. Equity: strongly progressive. Administrative: high feasibility; the agency runs waivers now. Political: moderate support.

Option 2, payroll benefit. Fiscal: self-funded by a 0.58 percent payroll contribution; stability depends on actuarial review. Coverage: reaches most working households, including middle-income families, before they spend down. Equity: benefits are flat while contributions rise with wages, which is progressive in effect; family caregivers, mostly women, gain from training and respite benefits. Administrative: moderate; requires building a new program and trust fund. Political: contested, with opposition to a new payroll deduction.

Option 3, insurance subsidies. Fiscal: about 90 million dollars over ten years. Coverage: low uptake in other states' partnership and subsidy efforts. Equity: benefits higher-income buyers who would have purchased anyway. Administrative: high feasibility. Political: moderate support.

Option 4, status quo. Fiscal: Medicaid long-term care spending continues to grow with an aging population. Coverage: no change for middle-income families. Equity: burden continues to fall on families, especially women caregivers.

Weighted Scores

Scores from 1 to 5 on each criterion, multiplied by weights, give: payroll benefit 3.9, waiver expansion 3.6, insurance subsidies 2.7, status quo 1.8.

The recommended option ranks first overall while ranking last but one on political feasibility, and the paper says so rather than hiding it.

Recommendation

Adopt a payroll-funded long-term care benefit, with biennial actuarial review, board authority to adjust the contribution within a set range, and portability for workers who move. Pair it with a smaller waiver expansion to reduce the waiting list for people already eligible for Medicaid, since the payroll benefit will not pay full benefits for several years.

What the Recommendation Loses

The payroll benefit loses on political feasibility: a new deduction from paychecks will face organized opposition, and Washington's program faced repeated amendments and a ballot challenge. It also does not help people who need care now, which is why the waiver expansion is included.

Sensitivity to the Weights

Because weights reflect values, the paper tested how much the ranking depends on them. Raising the political feasibility weight to a quarter of the total, taking the difference from fiscal sustainability, waiver expansion would edge ahead of the payroll benefit. If coverage of middle-income households were weighted at 35 percent, the payroll benefit's lead would widen. The recommendation therefore holds unless decision makers place much greater weight on avoiding political conflict than on protecting middle-income families, and the paper states that condition openly.

Lessons From Washington

Washington's program offers both encouragement and caution. It showed that a state can establish a payroll-funded benefit and begin collecting contributions, but it also faced early solvency concerns, changes to opt-out rules and debates about portability for workers who move. Each of those lessons is built into the recommendation through actuarial review, narrow opt-outs and portability. A composite state that follows a few years behind can learn from those adjustments rather than repeat them.

Who Would Administer the Program

The recommendation assigns the benefit to the state's employment security department for contributions, because it already collects payroll-based premiums, and to the aging services agency for benefits, because it already contracts with home care providers. An independent board with members representing workers, employers, older adults and caregivers would oversee both and receive the actuarial reports.

Rival Arguments

Opponents argue that a modest benefit of 36,500 dollars is too small to matter. Analysis of lifetime risk suggests that a benefit of that size covers the first year or more of home care for many families, which is when spend-down most often begins (Favreault & Dey, 2016). Others argue that the state should wait for federal action. Federal proposals have repeatedly stalled since the CLASS Act's repeal, and states are where experiments are now happening.

Implementation

Year 1: enact legislation and appoint a board. Years 2 to 3: begin contributions and build the benefit system. Year 4 onward: pay benefits to vested workers. Biennial actuarial reports to the legislature.

Limitations

The analysis relies on national risk estimates and Washington's design; actual uptake, costs and contribution needs in the composite state may differ, which is why the recommendation builds in review. Policy analysis texts caution that criteria weights reflect values and should be stated openly so decision makers can change them (Bardach & Patashnik, 2020).

References

Bardach, E., & Patashnik, E. M. (2020). A practical guide for policy analysis: The eightfold path to more effective problem solving (6th ed.). CQ Press.

Congressional Budget Office. (2013). Rising demand for long-term services and supports for elderly people. Congressional Budget Office.

Favreault, M., & Dey, J. (2016). Long-term services and supports for older Americans: Risks and financing research brief. Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services.

Long-Term Services and Supports Trust Program Act, Wash. Rev. Code § 50B.04.010 (2024).