Cost-cutting: States shift to long-term care

With their budget crises showing no signs of abating, states are looking at long-term care costs as an area ripe for redesign to improve quality, increase consumer choice, and they say, save money in Medicaid.

At a November 2002 meeting of the National Conference of State Legislatures, Virginia Dize, associate director for the National Association of State Units on Aging said that the demand for long-term care now represents 35% of state Medicaid spending and the costs are expected to increase significantly in the next few decades.

Drivers for a state evaluation of long-term care, she said, include the U.S. Supreme Court decision in the Olmstead case, which has an impact on choice and service waiting lists, and the administration’s New Freedom initiative that calls on federal agencies to look for barriers to home- and community-based services.

"The biggest barrier to home- and community-based service delivery is Medicaid’s institutional bias," Ms. Dize declared. "Those who have a right to services in an institutional setting don’t have an affirmative right to get services in the community. As a result, states are using waivers to be able to provide the services." States, she said, are showing an increased interest in quality and also are evaluating lessons learned from nursing homes. "No matter how wonderful your home- and community-based system is, if people can’t get access to it, and if they don’t know about it, it’s no good because you’re not serving the people you need to serve."

Ms. Dize added that if states maximize the ability of consumers to get information so they can make informed decisions about their options for home- and community-based services, they will be doing a lot to ensure that those consumers don’t end up in nursing homes. She also called attention to demonstration "cash-and-counseling" programs in which clients are able to hire neighbors, friends, and relatives to be their caregivers and don’t have to wait for an agency worker to be available.

More home/community focus

Sandy Newman, policy specialist for the Family Caregiver Alliance, reported that Pennsylvania has dramatically increased spending on home- and community-based care, successfully making the case to the legislative and executive branches that spending more money in communities, where most people would like to stay, should result in less of a financial drain and less stress on Medicaid.

The results of a 10-state study of the National Family Caregiver Support Program show that it’s working, Ms. Newman said.

"Families are getting the help they need. Families are getting information. They are going to support groups. They’re getting respite care. They’re getting all of the things that they need to remain in their caregiving role," she pointed out. "For many states, providing support services to caregivers is a paradigm shift. They’re used to creating a care plan around the person who has a chronic or disabling illness. They’re not used to serving caregivers."