SECTION 1.

 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. This population includes adults with developmental disabilities, individuals with traumatic injuries or acquired disabilities, and individuals 65 years of age or older 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 65 years of age or older

(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 California households with persons 65 years of age or older. The lowest cost care option, 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 personal tasks 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 older living in poverty are women. The failure to address this will 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 if they do not qualify for Medi-Cal. Younger people with disabilities find it difficult to save for retirement, or even contemplate retirement, due to the need to continually pay for the long-term services and supports they need to maintain their health and independence, and to function.

(9) Long-term services and supports help individuals maintain their dignity, autonomy, individuality, privacy, 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, including 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 and 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. Funding should be provided by those that ultimately will use the benefit and through other dedicated sources of funding that are outside of the Medicaid program or the General Fund.

(13) This legislation creates the infrastructure to administer the benefit, and the recently completed state-funded actuarial study for funding long-term services and supports provides the roadmap.