Financial planning could solve the looming Medicaid disaster

The U.S. is experiencing the largest wave of retirements in our history, with more than 11,000 baby boomers turning 65 each day. This demographic shift, coupled with record longevity, is fueling unprecedented demand for long-term care while placing immense strain on an already overburdened health care system.

If policymakers want to ease the mounting pressure on entitlement programs, they should begin by helping more Americans incorporate long-term care into their broader financial planning. The better families prepare today, the less likely they are to depend on taxpayer-funded assistance tomorrow.

Unfortunately, our current laws incentivize the wrong behaviors. Our current system has institutionalized a counterproductive cycle: Seniors must deplete their life savings and liquidate their assets to qualify for Medicaid assistance.

To fix this, some policymakers, including Senate Finance Committee Ranking Member Ron Wyden, D-Ore., in a recent letter, call for expanding public programs. But Congress faces the harsh fiscal reality of limited federal resources, a projected 2032 Social Security financing shortfall and a rapidly growing national debt.

Instead of creating costly new government programs and bureaucracies, Congress should make it easier for Americans to prepare through private planning, education and modern insurance solutions.

Empowering individuals to plan is more fiscally responsible than asking taxpayers who play their part to shoulder an ever-growing share of future long-term care costs.

Long-term care planning options are increasing

Americans have more planning options than ever before thanks to significant innovation in the private marketplace. Over the past two decades, the private sector has worked to develop more affordable and flexible alternatives to traditional long-term care policies.

In response to the pricing volatility of the 1990s, actuaries have developed a far more sophisticated understanding of policyholder behavior, longevity trends and underwriting. As a result, the industry has substantially revamped long-term care insurance design.

Today's combination of life and long-term care insurance products protects future care expenses while preserving value if those care expenses never arise.

The private long‑term care insurance market is well-positioned to serve financially capable households, but product innovation alone is not enough. With better information, families can incorporate long‑term care into their holistic financial planning, strengthening their own security rather than relying on unsustainable public promises.

Bipartisan support to address planning

Bipartisan momentum is building to address this awareness gap. Reps. Tom Suozzi, D-N.Y., and Aaron Bean, R-Fla., are leading the Planning for Long-term Aging Needs (PLAN) Act of 2026. The bill directs the Department of Health and Human Services to develop a national public education initiative to encourage individuals to plan for their future care needs.

Some of America’s most successful programs have been built on innovation, expertise and sustained collaboration between the public and private sectors.

That same model can help address America’s long-term care crisis by combining private-sector innovation with smart public policy.

By equipping families with better information and encouraging earlier planning, policymakers can improve financial security while reducing future pressure on Medicaid and other entitlement programs. Passing the PLAN Act is an important first step toward making long-term care planning a standard part of retirement planning while easing future pressure on Medicaid and other entitlement programs.

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Marc Cadin is the CEO of Finseca. Contact him at [email protected].