Delaware Medicaid looks to contain long-term care costs

Delaware Medicaid's long-term care population is still primarily fee-for-service, and this population is very high-cost because many individuals are in facility-based care, says Rita M. Landgraf, secretary of Delaware's Department of Health and Social Services. In April 2012, this group will switch to a managed care organization, she reports.

In calendar year 2010, Delaware Medicaid spent $154.5 million total funds on facility-based care, compared to $21 million total funds on home and community-based care.

Changing to a managed care framework will allow the state to re-balance the long-term care system, says Ms. Landgraf, enabling a delivery and payment structure that will offer options in the delivery of care.

"We are looking at the continuity of care and building a community network, to allow people to get their care in place," she says. "We are looking to support people with in-home health care after being discharged from the hospital, so they don't have to return to the hospital."

The Centers for Medicare & Medicaid Services is offering incentives to do this, notes Ms. Landgraf, and the Medicaid program is partnering with hospitals that want to avoid penalties for patients returning too quickly after being discharged.

Converting the long-term population into managed care will contain costs, according to Ms. Landgraf, and also give the population what it wants, so individuals don't have to go to a nursing home level of care prematurely.

"That is important for Delaware specifically because of our demographic shift. We are one of five states with a fast-growing demographic of individuals 65 and over," she says. "That will bring some challenges for the Medicaid program."

Robust support needed

The goal is to develop a continuum of care with robust community support, and to incentivize managed care organizations with a capitated rate that includes this, Ms. Landgraf says.

"We believe we can better support the population in the least restrictive environment, rather than the only option being a nursing home," she says. "The current practice we utilize in long-term care is just not sustainable. The population is just too huge."

Previously, Ms. Landgraf was an advocate for the aging population to be supported in their community. "Now, I analyze it from a cost-containment perspective. That doesn't mean that people don't get services that they need," she says. "It means that we are able to offer a menu of services, so they don't prematurely land in a higher level of care."

Ms. Landgraf says another pressing issue involves individuals having to sell their assets in order to qualify for Medicaid and get long-term care. "We force people into a level of poverty to get care they require. We have to rethink all of that," she says. "We need to leverage funding through supports, rather than creating a system where people have to become impoverished to get some level of care."

Another issue is reaching out to caregivers to meet their needs, says Ms. Landgraf, and looking at ways to pay them for the work they do. "It is going to be a paradigm shift and those things don't happen overnight," she says. "Things have to evolve to get to a better system of care that will result in better outcomes for the population, and be fiscally responsible."