Local collaboration needed for long-term care insurance

Private insurance may be the most viable approach to financing long-term care for middle- and upper-income elderly, but many issues must be considered. Should public policy favor service-oriented or indemnity plans? Should states require companies to offer a minimum plan benefit to sell policies? Should companies try to design integrated plans that presume future Medicaid eligibility for some private-plan enrollees? Should states and private businesses require professional quality review, utilization control, and cost management features? One policy direction would encourage local management of insured individuals' long-term care, but such a strategy should be tested for structural, technical, administrative, and financial feasibility. A local management structure for long-term care insurance would have four functions: expenditure control, utilization control, quality control, and service development.