By Jack Cumming

Two government-initiated citizen panels finished work recently providing recommendations to be accepted or rejected by the political leadership. The two reports differ in scope and focus. Both, however, define a government approach to aging. There is some tension between such a government approach and private enterprise approaches. Both approaches need to be considered.

The first, the “Final Report of the Federal Coronavirus Commission for Safety and Quality in Nursing Homes,” includes 27 recommendations. The second, the report of the Stakeholders Committee for the California Master Plan for Aging, contains in its multi-part entirety roughly 700 recommendations. The Stakeholders have also prepared an “Executive Summary” of just five pages.

The Federal Report is focused on COVID-19 while the California Report is broader. Uniquely, Jeannee Parker Martin, CEO of LeadingAge California, served on both committees. She was recently among a group recognized for their service by Vice President Mike Pence at the White House.

The Federal Report

True to its coronavirus focus, the recommendations in the Federal Commission Report emphasizes the following:

  • The need for adequate Personal Protective Equipment
  • Guidance for addressing issues raised by the pandemic
  • Emphasis on infection control measures
  • Communication about the pandemic with residents, their representatives, loved ones, and the public
  • Staff training
  • Improved funding
  • Upgraded infrastructure.

In a response document titled, “Trump Administration Actions and Commission Recommendations,” the Centers for Medicare and Medicaid (CMS) responded positively to most of the Report’s recommendations.

The California Report

Turning to the California Report, which now goes to the Governor’s office and cabinet for vetting, Professor Fernando Torres-Gil,  director of the Center for Policy Research on Aging at UCLA, gave an overview of the key findings. His summary included

  • Fix Long Term Care Services and Support System (LTSS)
  • Assure that California has housing that is affordable for all
  • Ensure equity of resources regardless of individual circumstances
  • End poverty.

He noted that California is a “majority minority” state and “We are leading the nation.” He continued, “We can show that there is no need to be afraid of diversity.”

With respect to implementation, the California Stakeholders concluded that there should be a single leader at the top, a deputy cabinet secretary or special counsel in the governor’s office, to make this program happen and to be assigned specific targets to achieve. They added that the State government should be “responsive, more efficient, and coordinated.”

Central to the Stakeholders’ recommendations was a proposal “to establish a new universal LTSS benefit that offers a flexible range of benefits that is sustainable and enables families of all incomes to plan and pay for their daily care needs both now and in the future.” In support of this proposal, the Committee included a feasibility study by the Milliman actuarial firm. The recommendations were in response to a key finding that: “We face the specter of ageism, ableism, and systemic racism, all exacerbated by COVID-19 and its impact on older adults and people with disabilities, especially in Black, Native American, and Latino communities.”

The Political Context

Government is good at achieving universal participation when that is desirable. People must pay Social Security taxes whether they believe they can afford them or not. Government is less effective at ensuring acquiescence with its compulsory acts. People regularly seek to minimize their tax burdens, setting up a kind of sport as taxpayers, for instance, seek to minimize their tax burden.

Regulatory directives are often met with perfunctory compliance. Government action is not effective, and is not intended to be effective, at winning the hearts and minds of those governed to bring about willing compliance. Likewise, government officials, not wanting to erode their authority, may discourage taking full advantage of legislated initiatives that favor the private sector.


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PACE: A Model for Innovation

A good example of a government authorized private initiative is the Program of All-Inclusive Care for the Elderly (PACE). It came into existence with the 1983 modifications to the Social Security Act. The Balanced Budget Act of 1997 (P.L. 105-33, Section 4801-4804) established PACE as a permanent part of the Medicare program and an option under state Medicaid programs. It provides many benefits not the least of which is improved medical care and lower cost than otherwise. Eligibility is, however, severely limited.  To qualify, an individual must be 55 years old or older, certified by the state to need nursing home-level care, reside near a PACE program, and able to live safely in the community. Certification gives the state government authority to approve or disapprove applications to participate in PACE programs.

Still, as one source puts it, “PACE programs have strong incentives to help keep their members as healthy as possible—their patients, if left without care, are likely to require extensive acute and nursing home care, which are very expensive. So PACE programs tend to provide high levels of preventive services, such as very frequent checkups, exercise programs, dietary monitoring, programs to increase strength and balance, etc.” The best programs also include services beyond healthcare, such as handyman services, transportation, and the like to enable participants to remain in their homes to avoid institutionalization.

PACE for All

In short, PACE could not only be effective for those few who now are eligible and approved by the State, but it could improve the quality and reduce the cost of care for all Americans. It’s a private enterprise innovation that uses ingenuity to achieve positive human benefits. If unleashed from its current constraints, one can envision PACE disrupting today’s healthcare and bringing the cost of American healthcare in line with our peer nations. PACE operates as a Medicare Advantage plan.

We’ve long had a lingering political debate in the United States about the role that government should play in healthcare. There are simple approaches that could ensure universal coverage while allowing individuals to opt for private delivery systems similar to the value-added that PACE for All, or today’s Medicare Advantage programs, can offer.

Germany has such a public-private hybrid system and in 2017 Germany spent just $5,728 per capita on health care while the United States spent $10,224.  We can do better than what the political wrangling in Washington, DC has given us.

Let us know your thoughts on how we might address these thorny, politicized issues. What do you think might be a viable approach?