Tag Archives: Laurie Edwards-Tate

Due to unprecedented growth in the senior population over the next 30 years, and the uncertainty regarding the future of national health care reform, the Private Pay Market is on the throes of explosive growth, especially in the area of Private Duty/Private Pay services in one’s home as a preferred alternative to institutionalization.

According to a recent study from the SCAN Foundation (“Caring,” January 2010), Americans across all demographic groups are concerned about the future of long-term care, which is critical in providing products and services to the aging population.  Here are the key findings:

• 92 percent of people surveyed say it’s important to improve coverage for services that help people remain in their homes instead of going into nursing homes;

• 90 percent of Republicans, 89 percent of Independents, and 97 percent of Democrats say improving coverage to help people remain in their homes is important;

• 78 percent of Americans say they would benefit personally if health care reform included coverage for long-term care services; and

• 68 percent say it’s very important to improve coverage for services that help people remain in their homes.

Given these beliefs and desires shared by the majority of Americans, it’s surprising and dismaying to find that both the House and Senate budget proposals contain cuts to Medicare home health funding. The House proposal contained $54.9 billion over 10 years, while the Senate version proposed home health cuts of $39.4 billion over the same period.  (NAHC Report, January 28, 2010).  These proposed cuts will come nowhere near serving the anticipated needs of Medicare recipients.

With these proposed Medicare cuts to home health care (medical care in the home which is generally episodic), we will see a corresponding growth in the need for Private Pay services (supportive, often non-medical, and long-term).

It is evident that something must be done to care for seniors, disabled, and chronically ill which will help them remain safely and securely at home. It is by far the most efficient and cost-effective form of support versus placing an individual in an assisted living or institutional situation, something the vast majority of families wish to avoid. As a result, expectations appear to be transitioning to the individual and their families to bear both the responsibility and the cost. Potential sources include family, private long-term care insurance, personal savings, reverse mortgages, and other forms of out-of-pocket payment.

So, “as the name suggests, private pay home care services are those which are arranged and paid for by individuals or members of their family” (Val Halamandaris, President, NAHC, “The Best of Caring,” 2009).

I remember working at a hospital years ago. I walked into a patient’s room and saw a nurse, sitting by her bedside, dressed in a white nurses’ uniform and adorned with a crisp, white cap.  When I asked who she was, she said:  “I am a private duty nurse….I was hired by the family to provide extra supervision for their family member.”

Now, as the economics of health care change, and the senior demographic expands, no longer is Private Duty merely a nurse providing extra duty at a hospital.  The potential scope of Private Duty/Private Pay services has expanded considerably, and may include an array of services ranging from personal care services to skilled nursing to telehealth to supervised home maintenance–and countless, potential additional services, some of which we may not have yet envisioned– which help maintain an individual safely and securely in his home.

This reality hits just as the need for services to support an aging population is expanding at a faster rate than ever before. In 2009 the market for in-home care nationwide is projected to reach approximately $15 billion, exhibiting a decade-long average compound annual growth rate of 10%. This industry is in its infancy.

Today, there are 36 million adults age 65 and over in the United States. This population is expected to nearly double to 70 million over the next 30 years. With an increasing average life expectancy for Americans reaching over 75 years of age, the need for senior care will continue to escalate.

Considering the growing potential for costly institutional, long-term care caused by the loss of publicly funded home care, Private Duty/Private Pay services will be eagerly sought ought and privately funded. The question is whether the industry will be ready with the capacity needed to provide these services to all those who seek them.