Policy Research Shop

Support for the Policy Research Shop is provided by the Fund for the Improvement of Postsecondary Education, U.S. Department of Education.

Policy Research Shop

The contents of this report were developed under grant P116B100070 from the U.S. Department of Education. However, these contents do not necessarily represent the policy of the U.S. Department of Education, and you should not assume endorsement by the Federal Government.

By: Michael Sanchez, Natalia Agredo, and Will Bishop

Long-Term Care in Grafton County

Shifting from Institutional to Community-Based Care

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Institutional Care vs. HCBS• How can stakeholders make HCBS cost

effective?

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1915 Waivers• 1915(i) Waivers:

– Provide HCBS under regular Medicaid plan• 1915(b) Waivers:

– Combine Medicare and Medicaid funding for HCBS• 1915(c) Waivers:

– Target HCBS services to specific populations

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Moral Hazard• The Woodwork Effect

– Increased participation– Incentive to receive HCBS over free family care

• Increases overall costs despite decreased per capita costs

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Choices for Independence (CFI)• Options for institutional care or HCBS

– Screening program (NHBAES)• Wide range of services offered

– Does not include emergency services

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Best Practices• State Programs

– ALTCS– PACE– Arkansas

• National Studies– Kaye, et al.– Amaral – Kitchener, et al.

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Arizona Long Term Care System (ALTCS)

• Program:– Mandatory program enrollment– Pools costs, allows for control of expenditures

• Outcomes:– Substantial increase in HCBS use– Quality of care decreased

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Program for All-Inclusive Care for the Elderly (PACE)

• Program:– Managed and Capitated Care– Avoid fee-for-service Moral Hazard– Use 1915(b) waiver to pool Medicaid and

Medicare funding• Outcomes:

– Cost growth lower on average

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Arkansas Community Connector Program

• Program:– Employ Community health workers– Identify at-risk populations

• Outcomes:– 30% decrease Medicaid spending compared to

control– Partially offset by non-health costs

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Kaye, et al. Study• Design:

– High-Low HCBS states– Expanding-Established HCBS states

• Findings:– Yields initial increase in per capita spending– Subsequent downward trends

• Long-term state savings

Kaye, H. Stephen et al.  “Do Institutional Long-Term Care Services Reduce Medicaid Spending?”  In Health Affairs, vol. 28 (2009): http://content.healthaffairs.org/content/28/1/262.full, acc. February 20, 2012

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Amaral Study• Design:

– Studied 1915(c) waivers– Fixed effects for state and year (1992-2000)– Regresses Medicaid spending on waiver

participants, controls• Findings:

– No evidence of cost shifting from institutional to HCBS

Amaral, Michelle.  “Does substituting home care for institutional care lead to a reduction in Medicaid expenditures?”  In Health Care Manag. Sci. (2010):http://proquest.umi.compqdlinkvinst=PROD&fmt=6&startpage=-1&vname=PQD&RQT=309&did=2191706191&scaling=FULL&vtype=PQD&rqt=309&cfc=1&TS=1329764251&clientId=4347 acc. February 20, 2012 

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Kitchener, et al. Study• Design:

– Also studied 1915(c) waivers; 2002 data– Compares HCBS and institutional– No time-series component

• Findings:– For all waivers, per capita savings of $43,947– For nursing home level, per capita savings of

$15,489

Martin Kitchener PhD, Terence Ng MA, Nancy Miller PhD & Charlene Harrington PhD (2006): Institutional and Community-Based Long-Term Care, Journal of Health & Social Policy, 22:2, 31-50

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Other Considerations• Relax eligibility restrictions

– Increase Medicaid’s share of HCBS costs– Raise total demand for HCBS

• Where do funds come from during the shift?– Cut nursing home funding, decrease quality– Other sources

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Future of Long-Term Care• Survey of experts

– Expanding HCBS under Medicaid supported– Reducing nursing home beds not supported

• Role of nursing homes in promoting HCBS

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Applying Academic Research• Use community outreach to recruit at-risk

individuals• Implement capitated care, cost pooling• Mandate enrollment

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Thank You!