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Long-term care partnerships: Are they fit for purpose?

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  • Bergquist, Savannah
  • Costa-Font, Joan
  • Swartz, Katherine

Abstract

Long-term care partnership (LTCP) programs were designed to both encourage middle-income individuals to purchase private long-term care insurance, and defer the time when an individual would become eligible for Medicaid to pay her long term care services and supports (LTSS). This paper exploits the timing of state Partnership implementation (including four pilot states) to evaluate the program’s effects on new yearly insurance applications and contract uptake. We draw upon data from the National Association of Insurance Commissioners (NAIC) on new long term care insurance (LTCI) purchases (traditional and Partnership) by US state (weighted by the population over age 65 to make the data comparable). We use a difference-in-differences strategy to obtain estimates of the program effect of the LTCP on the overall uptake of private LTCI, and specifically of LTCP contracts and applications for a subsample of states. Findings suggest no significant effect of LTCP on insurance uptake and an increase in insurance applications. This result points towards a substitution between traditional and partnership contracts.

Suggested Citation

  • Bergquist, Savannah & Costa-Font, Joan & Swartz, Katherine, 2018. "Long-term care partnerships: Are they fit for purpose?," The Journal of the Economics of Ageing, Elsevier, vol. 12(C), pages 151-158.
    • Handle: RePEc:eee:joecag:v:12:y:2018:i:c:p:151-158
    DOI: 10.1016/j.jeoa.2018.03.006
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    Cited by:

    1. Martín Caruso Bloeck & Sebastian Galiani & Pablo Ibarrarán, 2019. "Long-Term Care in Latin America and the Caribbean: Theory and Policy Considerations," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2019), pages 1-32, October.
    2. Lambregts, Timo R. & Schut, Frederik T., 2020. "Displaced, disliked and misunderstood: A systematic review of the reasons for low uptake of long-term care insurance and life annuities," The Journal of the Economics of Ageing, Elsevier, vol. 17(C).
    3. Joan Costa-i-Font & Nilesh Raut, 2021. "Long-Term Care Partnership Effects on Medicaid and Private Insurance," CESifo Working Paper Series 9335, CESifo.
    4. Akaichi, Faical & Costa-Font, Joan & Frank, Richard, 2020. "Uninsured by Choice? A choice experiment on long term care insurance," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 422-434.
    5. Sergi Jiménez & Analia Viola, 2019. "OBSERVATORIO DE LA DEPENDENCIA. TERCER INFORME, Noviembre 2019," Studies on the Spanish Economy eee2019-42, FEDEA.
    6. Joan Costa Font & Valentina Zigante, 2017. "Mortgaging Europe’s periphery," LEQS – LSE 'Europe in Question' Discussion Paper Series 125, European Institute, LSE.
    7. Coe, Norma B. & Goda, Gopi Shah & Van Houtven, Courtney Harold, 2023. "Family spillovers and long-term care insurance," Journal of Health Economics, Elsevier, vol. 90(C).

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    More about this item

    Keywords

    Long term care (LTC) insurance; LTC partnerships (LTCP); Subsidization; Medicaid; Difference-in-differences (DD); Insurance underwriting;
    All these keywords.

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I - Health, Education, and Welfare
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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