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Long-term care partnership effects on Medicaid and private insurance

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  • Costa-Font, Joan
  • Raut, Nilesh

Abstract

We examine the impact of the Long-Term Care Insurance Partnership (LTCIP) program—a collaborative initiative between the state-level Medicaid programs and private health insurance companies designed to promote private long-term care insurance (LTCI)—on insurance ownership and Medicaid utilization. We draw on individual-level longitudinal data and employ a difference-in-differences (DD) design adjusted for the staggered implementation of the program between 2005 and 2018. Our results suggest that the rollout of the LTCIP program led to a 1.54 percentage point (pp) (14.7%) increase in LTCI ownership and a 0.82 pp (13.3%) reduction in Medicaid uptake. Our estimates suggest that these combined effects led to an approximate average cost saving of $74 per 65-year-old participant. These findings are explained by a certain degree of substitution between LTCIP and traditional LTCI contracts, ultimately postponing the use of Medicaid benefits.

Suggested Citation

  • Costa-Font, Joan & Raut, Nilesh, 2025. "Long-term care partnership effects on Medicaid and private insurance," LSE Research Online Documents on Economics 127078, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:127078
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    File URL: https://researchonline.lse.ac.uk/id/eprint/127078/
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    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies

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