Academic journal article St. Thomas Law Review

Long-Term Care Insurance: A Life Raft for Baby Boomers

Academic journal article St. Thomas Law Review

Long-Term Care Insurance: A Life Raft for Baby Boomers

Article excerpt


Prior to the nineteenth century, long-term care was not singled out as a service provided to either the elderly or the ill, but rather it was viewed as care that should be provided in the home. (1) This included all medical, surgical, and nursing care. (2) Nursing homes emerged in the United States as poor relief centers in the eighteenth century. (3) Elderly individuals, who could no longer be cared for at home and those who lacked family assistance, were categorized with those dependent on state assistance, including: orphaned children, widows, the insane, the destitute, and those with substance abuse disorders. (4) These individuals were sent to state-sponsored "poor farms" or "almshouses," which were administered by local authorities. (5) From the 1820's through the end of the nineteenth century, the number of these institutions expanded rapidly as America received an influx of immigrants and farmers seeking employment in the city. (6) As a means to motivate families to find other resources to care for the elderly, local governments did nothing to improve the conditions of these almshouses. (7) The ultimate goal was to encourage those receiving care to lead respectable lives devoid of public assistance. (8) However, the care provided in these decaying facilities was substandard at best, and usually abusive or neglectful. (9)

In response to these publically ostracized institutions and the surge of economic dislocation during the Great Depression, cash benefit programs were created to provide the elderly and the poor with the financial means to support themselves at home. (10) Advocates for creating cash benefit programs also focused on the eradication of almshouses by means of eliminating their financing. (11) This became a reality in 1935 when Congress passed the Social Security Old Age Assistance Act ("OAA"), which barred almshouses from receiving funds. (12) The passage of this act, which matched individual states with funds for the elderly who were retired, was the first time the federal government provided financial assistance to the elderly, and was the forefather of Medicaid. (13)

Many individuals who were in these institutions due to financial hardship were able to use their cash benefits to either return home or live in private facilities. Unfortunately, the elderly and infirm who required long-term care were left with few resources, which paved the way for private, fee collecting, unregulated sanatoriums to fill the void. (14) Although the care provided was often worse than the standard of care in almshouses, these private institutions were allowed to collect the resident's OAA benefits. (15) By the beginning of the 1950s, the OAA cash benefits, which had been intended to provide the monetary support the elderly required to live at home, had given rise to the nursing home industry.

In 1946, Congress passed the Hospital Survey and Construction Act, generally known as the Hill-Burton Act, to promote the construction of hospitals and public health centers. (16) Soon after, in 1954, the Hill-Burton Act was amended to include nursing homes, chronic disease centers, treatment centers, and rehabilitation centers. (17) This changed the construction models and required non-profit nursing homes to be modeled after hospitals. More importantly, however, this was the first time legislation referred to nursing home care as part of the healthcare system rather than the welfare system.

On July 30, 1965, President Lyndon B. Johnson signed Medicare and Medicaid into law, thereby providing low-cost health and hospitalization insurance to America's elderly and medical assistance to the "worthy poor." (18) Medicare was designed to provide health insurance rather than as a mean of custodial support. (19) Consequently, it was carefully written to exclude any form of extensive long-term nursing care unless it was post-hospitalization, convalescent, or rehabilitative care. …

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