By Jack Cumming

Recently, I was listening to an interview with James Balda. In case you don’t know Mr. Balda, his office is in Alexandria, VA, where he heads Argentum which was formerly known as the Assisted Living Federation of America. Argentum differs from LeadingAge in its openness to all senior living operators while LeadingAge limits its membership solely to tax-exempt providers. Notably, also, the distinction between CCRCs (aka LPAs) and Assisted Living has been blurring in recent years as independent living increasingly resembles assisted living.

Mr. Balda is a thoughtful, creative leader who believes with absolute conviction that the long-term care industry is essential to our American Dream. He calls on policymakers to recognize that and to ensure that the industry remains both strong and private so that it can thrive to meet the need in a way in which pure public programs such as Medicaid often fall short.

Policy, Workforce, and Quality

In discussing what his corporate members want, Mr. Balda cited public policy, workforce assistance, and service quality. He has a number of initiatives in each of these challenge areas. Notable is the grant-funded apprenticeship program that Argentum offers in conjunction with a handful of operators to address workforce retention. If the industry can reduce turnover, that will go a long way toward helping to address the workforce challenge.

Toward the end of the interview, however, Mr. Balda took a step back from his official role as Argentum CEO to offer a personal view. As he spoke, he was thinking of a $3.5 trillion social package under consideration by Congress. The package has been spun as a human infrastructure investment. He noted the positive intent of the sponsors, but he opined that they have it wrong since what the nation needs, he said, is a Marshall Plan for long term care.

That set me thinking as an actuary committed to ensuring both sustainability and interpersonal equity in long-term financial programs like pensions, healthcare, and other welfare security undertakings. The original Marshall Plan (proposed in a 1947 speech at Harvard by American General and statesman, George Catlett Marshall) was an aid program to help Europe recover from the destructiveness of war. Combined with American troops stationed as a first line of defense for Europe, and with American subsidization of the German Mark and other currencies, the Marshall Plan allowed what Germans called the Wirtschaftswunder or Economic Miracle. Germany is prospering today because of American support.

A Profound Suggestion

Mr. Balda likely was suggesting that the government finance the long-term care industry for which he advocates to a greater extent than it does already. My thinking as he spoke was that the United States is already spending more than any other nation on the planet on healthcare and that we don’t have commensurate value to show for it. Of course, there’s not much of a public outcry since most costs are covered by third parties, either government or employers. Still, some employees feel bound to an undesirable job for fear of the loss of their healthcare coverage, so there is an undercurrent of dissatisfaction and there are gaps in coverage.

America’s healthcare system lags the world in cost control by a wide margin and, at best, matches healthcare in other nations. Though there is evidence that access to care in the U.S. is uneven among socioeconomic population sectors. Our system also reflects our political and economic dynamic. Programs like Medicare, Medicaid, and Obamacare reflect the contentious trade-offs of a dysfunctional Congress, while lobbying favors certain commercial interests without regard to price and with little regard to merits.

A Marshall Plan for Long Term Care

Mr. Balda is right about the need. Medicare now does not include long-term chronic care. Still, it’s equally apparent that we need to reduce the cost and improve the quality and accessibility of healthcare if there is to be any room for comprehensive long-term care funding reform. Today, long-term care after the first 100 days is paid either by individuals, or provided by unpaid caregivers, or paid by the government under the Medicaid program after afflicted individuals have been impoverished by the system.

If we are to include coverage for long-term care in any American system, the U.S. cost challenge mandates that it be included within an overhaul of the system. Since the healthcare system is driven by Congress with its partisan dysfunction and susceptibility to lobbying, any overhaul has to be simple and popular. The obvious choice for a benefits package is Medicare since Medicaid varies from state to state and the Affordable Care Act (Obamacare) is neither comprehensive nor logically priced. There is a mandate that rates for the youngest enrollees be at least one-third of those for the oldest.

Keep It Simple

Medicare offers several advantages for a start. First, the benefits are established and widely accepted. Second, it would be simple to eliminate the age restriction to open the same benefits to Americans of all ages. Third, Medicare already includes an option for people to select private sector alternatives (Medicare Advantage Plans) if those better meet their needs. That allows private initiative to innovate to improve the system without onerous legislative meddling. Welfare payments can fill in Medicare copays for those who are indigent.

That leaves how to pay for the system and what changes might reduce basic medical costs sufficiently to allow room for long-term care coverage like what Germany achieved. The paying part is the easier part. The FICA system (Social Security plus), already provides an effective cradle to grave payment system to match the cradle to grave benefits needed. All that is needed is to have the Office of the Actuary recurrently calculate the cost and to relate it to the FICA tax base, adjusting the FICA tax to cover the cost.

America Above Party or Self-Interest

Setting in motion steps to constrain cost has eluded our government for decades. Meanwhile, we have seen other countries with similar systems – notably Germany – get their costs down to economically competitive levels. Cost and quality breakthroughs are likely to come from those private initiative Medicare Advantage plans if they are freed to innovate without being constrained by micro-managing regulations.

Our common purpose is a healthier, happier, more vigorous population and that purpose should take precedence over other special interests, including those of physicians in the American Medical Association, hospitals in the American Hospital Association, pharmaceutical firms in the Pharmaceutical Research and Manufacturers of America®, or others seeking advantage at the expense of our nation’s common good.


It’s not our purpose here to speculate on how to bring our medical costs under control while giving Americans the exceptional care and wellness support that they expect. We could, of course, but that’s best left to another time. A solution will require proactive deliberative big picture thinking beyond the particularistic silos of special interests and beyond reactive well-intentioned but often misguided regulation.

For now, we applaud James Balda’s call for a Marshall Plan to make healthcare, including long-term care, work for all. The Marshall Plan was distinguished by global thinking and that’s exactly what we need to make America a healthier, more productive nation. We can do it if we keep it simple, principled, popular, financially sound, and above partisanship.

Post Publication Note.  After publication, we received the following communication.

From: James Pieffer Date: Fri, Oct 15, 2021, 4:25 AM

Steve, Article about James Balda by Mr. Cummings in today’s email made a false claim about LEADINGAGE. Over half of the LEADINGAGE state affiliates and the national Association allow for profit Membership. He made an incorrect statement in differentiating it from Argentum. I think this is an error that should be corrected.

I enjoy reading your blog. Please be careful to be more accurate. LEADINGAGE is an outstanding organization and shouldn’t be misrepresented. Jim Pieffer

Sent from my iPhone

James Pieffer
President and CEO

Presbyterian SeniorCare Network
1215 Hulton Road
Oakmont, PA 15139

Author’s Response.   Thank you for your support of SLF.  The reference was to national LeadingAge, and if national LeadingAge welcomes for-profit providers as full members, that’s good news.

Let us hear from you, our readers, about how important you believe the nonprofit/for-profit difference to be.  We welcome your input.  – Jack Cumming