PPA 419 – Aging Services Administration Lecture 6 – Long- term Care and Medicaid.

PPA 419 – Aging Services Administration

Lecture 6 – Long-term Care and Medicaid

Introduction

Long-term care services provide assistance to individuals with difficulties in– Activities of daily living (ADLs)

Eating, bathing, dressing, getting in and out of bed, using the bathroom

– Instrumental activities of daily living (IADLs) Housework, laundry, shopping, taking medication,

transportation.

Introduction

Characteristics of community-dwelling elderly with substantial long-term care needs (6.4 million)– 9% over 85– 29% below 150 percent of poverty– 28% fair or poor health– 31% alone, 56% married, 13% with others.

Introduction

Characteristics of nursing home residents (1.6 million)– 72% female– 49% 85+– 64% Medicaid coverage– 83% need assistance with 3+ ADLs– 70% memory loss.

Impact of Sociodemographic Change on the Future of Long-Term Care

Introduction– Sociodemographic change can have an impact on both the

potential demand for long-term care and the supply of workers available to provide this care.

– Population projections indicate that the sheer volume of those likely to demand long-term care, along with age distribution, racial and ethnic mix, and education level will change over the next fifty years.

– Long-term care includes institutional services, paid home- and community-based care, and unpaid support through family and friends.


Long-Term Care Users– The probability of long-term care increases as one

gets older, particularly after age 75.

Percentage Using Long-Term Care by Age

0%

20%

40%

60%

80%

100%

Age

Per

cen

tag

e

Percent UsingLong-Term Care


Long-term Care Users (contd.)– Majority of long-term care users (60%) are elderly.– Higher probability of using long-term care

FemaleBlackWidowed or never marriedLess than a high school education


Long-term Care Users (contd.)– 40 percent use only informal care (friends and family).

Men Minorities Married individuals Less education

– Nursing facility care Female Non-minorities Widowed over never married


Effects of Change on Demands for Care– The Baby Boom bulge

Population 65 and over will double by 2050. Most rapid growth between 2011-2030 85+ will drop from 28% to 23% of elderly between 2005 and 2020,

but will jump to 34% by 2050. Number with at least one ADL limitation will increase from five

million to eleven million by 2050, while those with two limitations will increase from 2.0 million to 4.6 million.

Proportion of disabled over 85 will increase from 36 to 49 percent. Result: Greater demand for long-term care services and

potentially greater demand for institutional services.


Effects of Change on Demands for Care– Minority elders

An increasing proportion of minorities among the elderly might increase demand for long-term care services.

African-Americans are 50 percent more likely to use long-term care (mostly informal and community-based)

Hispanics require less overall care, but rely more on informal care.

– Better educated elders Greater percentage with high school diploma or GED. Education may reduce disability rates.


Effects of Change on Demands for Care– Elders with higher income

Average income of the elderly will increase 60% in real terms between 2001 and 2044.

Single women will have largest increases, but will still have lowest levels of income.

Incomes for elderly couples and single people age 85 and over will increase more rapidly than for younger groups. The latter will still be about 30 percent lower than for all elderly.


Effects of Change on Availability of Informal Support– More spouses

Percentage of married elderly will increase slightly.

– More childless individuals Nearly twice as many women may not have informal

support from children.


Summary– By 2050, the number of individuals reaching ages that may

require long-term care will more than double.– Will increase demand for long-term care workers.– Supply will depend on wages paid, labor force participation

patterns of older workers, and immigration.– Increased numbers of African-American elderly may signal

increased demand, whereas greater education may signal decreased demand.


Summary (contd.)– Diversity will require greater emphasis on cultural competency.– Greater education may affect methods of communication– Real income may counterbalance costs if costs do not

increase to match income increases.– Informal supports may decline with declining birth rate.– Community based settings may demand more transportation.– But: Baby boom may overwhelm everything else.

Long-Term Care: Medicaid’s Role and Challenges

Over 12 million people in the United States need help with basic activities of daily living (ADLs) requiring long-term care services (institutional, community, informal). 10.6 million in community and 1.5 million in nursing facilities

Elderly are the primary users and among the elderly, the very old and those who live alone.


Spending on long-term care reached $115 billion in 1997.

Over 40 percent was financed by Medicaid, including half the costs of nursing home care.

However, Medicaid only pays for those who have exhausted their financial resources.

More than one-third who entered nursing homes, and more than 70 percent who were there at least one year, had catastrophic expenses (40 percent of income and assets).


Elderly pay out-of-pocket for 30 percent of long-term care costs.

Medicare and private insurance play a limited role. Current system does not adequately cover all those

with disability needs (up to 20 percent report an inability to meet all long-term care needs).

Increases in disabled population and health care costs will likely make the problems worse.


Health Insurance Coverage for Elderly with long-term care needs– 57% Medicare and private– 19% Medicare and Medicaid– 16% Medicare only– 3% Medicare and other– 5% Other and unknown


For the elderly and nonelderly poor who need long-term care, Medicaid is a significant source of health insurance

– 64% of 18-64– 44% of 65+

For long-term care itself, Medicaid is a significant source.– $115 billion on long-term care (12% of national health spending).

66 percent financed by Medicaid and out-of-pocket expenses.– $83 billion on nursing home care. 78 percent financed by Medicaid

and out-of-pocket expenses.– Informal care not included in these costs.


Medicaid– 40% of all long-term care costs.– 50% of nursing home costs.– 70% of nursing home residents.– Long-term care is 35% of Medicaid budget.

Medicaid is nation’s safety net provider for long-term care.

Middle-income individuals must spend down assets and income to become eligible.

– Discuss.

Long-term care policy issues

Access to care– Availability of providers to deliver care at low rates

Repeal of Boren amendment may make things worse.

– State restrictions on nursing homes and nursing home beds.

– Access to community-based alternatives has been limited in most states. Medicaid’s institution bias.

Long-term care policy issues

Quality– Long-standing concern– Comprehensive nursing home reforms

OBRA 1987 Improvements in quality of care, reductions in restraints,

increases in behavior management programs, hearing aids, psych therapy.

Growing demand for Long-term care– Baby boom.

Financing– Public programs remain liable.

Regulating Nursing Homes

Major problems continue despite federal regulation.– In 1998-1999, 25-33% had serious or potentially life

threatening problems.– 26% had poor food hygiene, 21% provided

inadequate care, 19% had environments that contributed to injuries in residents, 18% improperly treated pressure sores.

– About 77% of problem facilities had problems in subsequent surveys.


Ownership and quality of care– Greatest violations in for-profit homes (30% more violations of

quality of care and quality of life)

Federal Regulation– State and licensing and certification with federal standards– Standardized comprehensive assessments on admission and

yearly. Care plans– Annual surveys of 185 quality requirements.– Central data collection on compliance– Enforcement procedures with intermediate sanctions.


Federal regulation– 1987 law, intermediate sanctions: fines, payment

denial, managers. Flaws

– Inadequate staffing– Poor mix of skills– Ineffective system of survey and enforcement

(GAO)– Poor levels of Medicaid payment decrease staffing.

Federal and State Enforcement of the 1987 Nursing Home Reform Act

BACKGROUND– The Nursing Home Reform Act of 1987 established quality

standards for nursing homes nationwide, established resident rights, and defined the state survey and certification process to enforce the standards (See PPI Fact Sheet Number 84: "The Nursing Home Reform Act of 1987.")

– Ten years after the passage of the Nursing Home Reform Act, however, a series of research studies and Senate hearings called attention to serious threats to residents' well-being. These problems were attributed to weaknesses in federal and state survey and enforcement activities.


NURSING HOME QUALITY IN CALIFORNIA– In 1997, the Senate Committee on Aging, chaired by Senator Charles

Grassley, received reports of widespread death and suffering in California nursing homes caused by inadequate care. In response to these reports, the Committee held a hearing on California nursing homes in July 1998. A General Accounting Office (GAO) report presented at the hearing revealed that, despite the requirements of the Nursing Home Reform Act, weak enforcement put many residents at risk of substandard care. Between 1995 and 1998, state surveyors cited 30 percent of nursing homes in California for violations that put residents in immediate jeopardy or caused actual harm to residents. Another 33 percent of facilities were cited with substandard conditions that caused less serious harm, and another 35 percent had more than minimal deficiencies. Only 2 percent of California facilities were found to have minimal or no deficiencies.


NURSING HOME QUALITY IN CALIFORNIA– While state surveyors identified widespread serious problems,

the report suggested that many other care problems went undetected due to weaknesses in federal and state nursing home oversight. Even when serious problems were identified, enforcement actions often failed to ensure that they were corrected and did not recur.

– Although the study focused on California, the findings were indicative of broader problems in the nursing home enforcement system. Based on their findings, GAO recommended strengthening federal and state oversight of nursing homes to better protect residents throughout the country.


THE SURVEY PROCESS COMPARED WITH THE ALTERNATIVES

– Also in July 1998, the Health Care Financing Administration (HCFA) published a report that examined the effectiveness of the current survey and certification process and the proposed alternatives of private accreditation and incentives. While the study indicated that the Nursing Home Reform Act of 1987 had resulted in improved resident outcomes, it also concluded that many of the enforcement processes were not working as intended. Despite the flaws in the survey and certification process, however, the study found federal enforcement to be more effective in protecting residents than either private accreditation or incentives.


THE 1998 NURSING HOME INITIATIVE– Concurrent with the Senate Committee on Aging hearing, the GAO report

on California nursing homes, and the HCFA study, the Clinton Administration announced the 1998 Nursing Home Initiative. The Initiative included a series of proposed steps designed to improve enforcement of nursing home quality standards. To implement the Nursing Home Initiative, HCFA has begun a series of steps to improve nursing home enforcement procedures. These include:

Staggering nursing home inspections, with a set number occurring on weekends and evenings;

Inspecting more frequently nursing homes that are repeat offenders with serious violations, without decreasing frequency of inspections for other facilities;

Enhancing the HCFA review of nursing home surveys conducted by the states; Terminating federal nursing home survey funding to states that fail to perform

adequate surveys;


THE 1998 NURSING HOME INITIATIVE– HCFA has begun a series of steps to improve nursing home

enforcement procedures. These include: Imposing immediate sanctions on nursing homes found guilty of a

second offense for violations harming residents; such facilities will not receive a "grace period" allowing them to correct problems and avoid penalties;

Allowing states to impose civil monetary penalties for each instance of a serious or chronic violation; and

Ensuring that state survey agencies enforce sanctions against nursing homes with serious violations and that sanctions are not lifted until after an onsite visit has verified compliance.

– Some states have also implemented their own efforts to improve nursing home quality enforcement.


FUNDING FOR ENFORCEMENT– State survey, certification, and enforcement activities are funded through the

Medicare and Medicaid programs. The federal government finances 100% of the Medicare budget and 75% of the Medicaid budget for state survey and certification activities. States provide the remaining 25% of the Medicaid survey and certification budget. Currently, HCFA distributes federal funds to states based on past state practices and costs, thereby perpetuating low budgets in states that have spent less for survey and certification activities. HCFA is now exploring options for better distribution of future survey and certification funding.

– In the meantime, recognizing the increased costs associated with the Nursing Home Initiative, the Administration and Congress have significantly increased the federal Medicare and Medicaid budget for state survey and certification activities. Federal funding grew from $290.2 million in fiscal year 1998 to $310.1 million in 1999, and to $358.7 million in fiscal year 2000.


NURSING HOME QUALITY NATIONWIDE– Following the California study and the announcement of the 1998 Nursing

Home Initiative, GAO and HCFA conducted additional research that included nursing homes nationwide. The findings were presented at a series of additional hearings on nursing home quality held by the Senate Committee on Aging in 1999 and 2000. These reports and hearings confirmed that problems of substandard quality, weak survey procedures, and ineffective enforcement were not limited to California, but were widespread throughout the nation. Key findings include:

– In 1997 to 1998, over one-fourth of nursing homes nationwide (27%) were cited with violations that caused actual harm to residents or placed them at risk of death or serious injury. Another 43 percent of homes were cited with violations that created a potential for more than minimal harm.

– During annual surveys, state surveyors often missed significant care problems, such as pressure sores, malnutrition, and dehydration. This problem reflected both weaknesses in state survey methods and the predictable timing of the surveys.


NURSING HOME QUALITY NATIONWIDE– Complaints made by residents, family members, or nursing home staff often

went uninvestigated for weeks or months. In addition, states frequently had procedures that discouraged the filing of complaints.

– When serious quality deficiencies were detected, enforcement mechanisms frequently failed to ensure that the problems were corrected and remained corrected.

– Federal procedures for overseeing state monitoring were limited in their scope and effectiveness.

– Over half (54%) of nursing homes had fewer than the minimum number of nurse aide time per resident to avoid harming residents. These facilities put residents at increased risk of hospitalization for avoidable causes, pressure sores, and significant weight loss due to inadequate staffing.

– As a result of these findings, GAO recommended additional steps to improve enforcement of quality standards, many of which are being addressed by HCFA's new efforts at enforcement.


EFFECTS OF THE NURSING HOME INITIATIVE– In September 2000, the Senate Committee on Aging held a hearing on the

outcomes of the Nursing Home Initiatives. A GAO official testified at the hearing that the Initiatives had resulted in improvements to state survey and federal oversight procedures, including:

Several states have increased, or plan to increase, the number of surveyors; Several states are automating their information systems to track complaints more

effectively; States have begun to use new methods introduced by the initiatives to spot serious

deficiencies when conducting surveys; and HCFA has made organizational changes to improve nursing home oversight

activities and to help ensure consistency across regions. – At the same time, a GAO report noted that many of the new policies and

practices have only recently begun and will need time to be fully implemented. Moreover, HCFA is in the process of implementing the Nursing Home Initiative, some parts of which may not be introduced until 2002 or 2003. Hence, it may take a few more years before the full effects of the efforts to improve quality of care can be known.


CONCLUSION– Inadequate implementation and enforcement have seriously

limited the effectiveness of the Nursing Home Reform Act of 1987. To address this problem, the Senate Committee on Aging began holding hearings on nursing home quality, and the Clinton Administration introduced the 1998 Nursing Home Initiative. While these efforts have resulted in some improvements, more work needs to be done to improve quality in the nation's nursing homes. As a recent GAO report concludes, "Sustained efforts by HCFA and the states are essential to realize the potential of the quality initiatives" (GAO, 2000).

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PPA 419 – Aging Services Administration Lecture 6 – Long- term Care and Medicaid.

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