April 4, 2024
Much has been written on the Coming of the Baby Boomers and their expectations as consumers as they age. Despite all of the hyperbole, less focus has been on the way that care is delivered and how these models need to change and adapt to the challenges of keeping so many older adults independent in their homes. In order to address such an unprecedented challenge, solutions must combine both innovative service delivery models with robust data analytics.
While many look to the post-acute healthcare space to run point on home-based interventions, the reimbursement model for healthcare prevents any appreciable innovation beyond medicalizing aging. Instead, the long-term care insurance industry (LTCI) has systemic reasons why the innovations within this field will provide the initial playbook for how the world successfully ages-in-place.
Unknown to most, long-term care insurance is the only insurance that pays for care services like home care, assisted living, and skilled nursing facilities. No, Medicare does not cover these services.
What’s more commonly known or written about LTCI are the tremendous financial losses these companies have incurred due to miscalculations by actuaries in pricing these products, unexpected increase in life expectancy, and the advent of the assisted living facility. In other words, insurance carriers typically took in significantly less in premiums than they pay out in claims. This imbalance creates a fascinating opportunity for innovation because so many carriers must solve the care delivery process, and fast since the industry’s $9B in reimbursements are expected to double by 2020–2021. Critically, LTCI are the payers of care. Meaning, claims teams within their organizations can implement innovative solutions without dealing with any reimbursement red-tape that hinders the healthcare world. This is absolutely crucial to moving the needle on changing how we age.
We believe one of the first salvos in this process has been cast through our (The Helper Bees) work with CNA. One aspect of the partnership is allowing caregivers to easily track the care they deliver within their home while making it easier for claimants to file their claim with their insurance company. An important side effect of these partnerships is providing unprecedented insights to encourage and improve how aging in place practically is accomplished, while simultaneously reducing a burden on claimants. Turns out visit notes are a wealth of information regarding what is happening in the home. The key is analytic algorithms that convert visit notes into actions. Our partnership with CNA and other carriers allows for this early data set to be created.
The second component of this innovative partnership offers personality matching of private caregivers to claimants who need home care services. By re-centering the caregiving process on the relationship, care delivery has a higher probability of being fully utilized. This is no minor feat since numerous studies have shown that an increase in quality care coordination for home care can increase the length at which an individual can remain at home by up to 9 months. By coupling a very traditional service offering (home care) with the modern direct connection/gig economy model, we are able to adapt to the needs of an increasingly discerning customer.
This is just the start. The innovation being sought out by LTCI claims teams touches on important areas like brain health, medication management and, social isolation. All of these must interact with a digital claims process in order to realize its full potential. Who would have thought that an insurance product would be the trailblazer on one of society’s most pressing demographic crises?