Choice Cuts Costs in Medicaid Programs

States are finding choice is one way to cut costs as America ages.

Policymakers are learning citizens want choice when it comes to long-term care of the graying population.

Marc Gold, director of the Promoting Independence Initiative in the Texas Department of Aging and Disability Services, said the cost of nursing home care is about twice the cost of similar services in community-based care.

“Community care is not only about human choice, not only about individual choice, not only about quality of life, or quality of care,” he said. “Not only is it the preferred model. It’s about saving money.”

Gold was among the speakers at Tuesday’s session, “The Graying of America: Providing Health Services without Breaking States’ Budgets.” He detailed how the Texas “Money Follows the Person” program has saved the state money, and improved the quality of life for many of the state’s seniors.

“The tsunami of the aging population is here, it’s real,” said Gold.

Mike Festa, a former Massachusetts legislator who was recently appointed secretary of the state’s Department of Elder Affairs, said it took four years to pass Massachusetts’ Equal Choice legislation. But it was well worth the effort.

He said other states considering such a program should understand the number of seniors eligible for services.

“The concept starts with the understanding that there are seniors that by clinical eligibility are going to be entitled to a certain level of services,” Festa said. “We should not be limiting opportunities for seniors to receive services in one particular setting. We want the least restrictive law.”

Community-based long-term care is a growing trend across the country. But Gold and Festa pointed out that there will always be a need for nursing homes. Both said companies running nursing homes will still play an active role in providing long-term care, but the business model must change because of the changing services.

For instance, Gold said 72 percent of the long-term care population is being cared for in Texas in community-based programs.

States are restructuring Medicaid programs to accommodate the changing service models for the graying population.

According to Kathleen Gifford of Health Management Associates, Medicaid is the largest health care program in the states. And while the largest population enrolled in state programs is children, the biggest expenditures come with the elderly population.

Administration of Medicaid programs, Gifford said, contributes to institutional bias. For instance, nursing home care is an entitlement under Medicaid. Community-based care is not.

“Every state has the focus to rebalance long-term care assistance to allow people to be served in the settings they want to be served in,” she said. “States continue to be focused on expanding home- and community-based services.”

She said 40 states plan to add a new waiver or community-based care slots to existing waivers in 2008. “It’s practically universal that states are focused on increasing options of home- and community-based services.”

—Mary Branham Dusenberry
Source: Choice Cuts Costs in Medicaid Programs

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