SECTION 1.
(a) The Legislature finds and declares all of the following:(1) Almost 8,000,000 Californians are either older adults or individuals with physical and mental disabilities. These individuals include adults with developmental disabilities, individuals with traumatic injuries or acquired disabilities, and individuals over 65 years of age with functional impairments due to age.
(2) This population is expected to grow significantly over the next decade due to demographic shifts, increased longevity, and a corresponding increase in disability. It will also be much more racially and ethnically diverse. In addition, more older adults are likely to live
alone.
(3) As a result, these individuals will need more and better access to long-term services and supports. Based on data from the 2015 American Community Survey, over 1,000,000 Californians will need long-term services and supports by 2030. Of those, 55 percent will be over 65 years of age.
(4) The current private long-term services and supports market is broken. Over the last 20 years, the number of companies offering these products has shrunk from over 100 to less than 12. This leaves families to rely on their own resources. Paying out-of-pocket for long-term services and supports is highly expensive and creates a significant long-term financial and social burden for families.
(5) According to the AARP/SCAN 2020 LTSS Scorecard, only 4.2 percent of Californians over 40 years of age have purchased long-term care
insurance. The cost of private pay nursing home care is 232 percent of the annual median income of 65 years of age or older California households. The lowest cost care option, utilizing a minimal number of hours of daily in-home care, is 71 percent of the annual median income of older California households.
(6) When costs are high for people who pay privately and do not have long-term care insurance, they will more quickly deplete their life savings and turn to the public safety net. If that safety net is inadequate, people may rely so heavily on family caregivers that those caregivers damage their own health and well-being and long-term earnings due to cutting back on work hours or dropping out of the workforce altogether.
(7) At least 90 percent of older adults receiving help with daily activities receive some informal care, and about two-thirds receive only informal care.
AARP’s cost of caregiving research showed that on average, family caregivers pay nearly $7,000 out of pocket each year to assist their older loved ones. Nationally, family caregivers, who are the backbone of our LTSS system, are overwhelmingly women (86 percent), most are people of color (59 percent), and about one-quarter are immigrants. These caregivers usually work without any compensation and almost one-half of informal caregivers said they have things they cannot handle or do not have enough time for themselves. This impacts their ability to participate in the workforce and save for retirement, and ultimately contributes to the “feminization” of poverty. Nearly two-thirds of individuals 65 years of age and over living in poverty are women. The failure to address this will literally increase poverty for the next generation.
(8) Younger people with disabilities, with or without families, bear the significant burden of paying out-of-pocket
for long-term services and supports when they do not qualify for Medi-Cal. Younger people with disabilities find it difficult to save for their retirement, or even contemplate retirement, due to the need to continually pay for the long-term services and supports they need to maintain health, independence, and function.
(9) Long-term services and supports help individuals maintain their dignity, autonomy, individuality, privacy and sense of safety, security, and order. Most individuals prefer to remain in their homes for as long as possible, particularly in light of the COVID-19 pandemic.
(10) Long-term services and supports include a broad range of services that enable older adults and individuals with physical and mental disabilities to live independently in their communities. They include personal care services, assistance with health needs, assistance with activities of daily
living such as bathing, dressing, toileting, and cooking, adult day services, transportation, social services, in-home support care, assisted living, home modifications, assistive technology, nutrition assistance, person-centered care coordination, supportive services, and nursing facility services.
(11) Long-term services and supports are not adequately covered by Medicare. The Medi-Cal program covers some long-term care services and supports, but because “spending down” to become eligible for Medi-Cal is the primary means by which older adults and individuals with disabilities currently receive access to paid long-term services and supports, the shifting demographics will create significant budget pressures for the Medi-Cal program, including the In-Home Supportive Services (IHSS) program.
(12) This crisis worsens every day. It is one that can no longer be ignored. It is
bankrupting families and steadily increasing the burden on all taxpayers. The solution must be the creation of, and funding for, a long-term services and support benefit. This will require placing shared funding responsibilities on all Californians, both those that ultimately will use the benefit and through other dedicated sources of funding that are outside of the Medicaid program or the state General Fund.
(b) It is the intent of the Legislature to create a cash or reimbursement form of benefit for those individuals that participate through the payments set forth in this act.