On the Verge: The Transformation of Long-Term Services and Supports 1
Research Methodology AARP 2
Primary Findings State LTSS • States on the verge of transforming the financing and delivery of LTSS Transformations • Many plan to or have implemented Medicaid Managed LTSS Budget Cuts and • States using administrative tools at their disposal to curtail expenditures Increased Demand • Increased demand due to economic downturn • With 26 new governors in office in 2011, record number of new Staffing Changes state officials and Reductions • Staff reductions top the list of savings strategies for aging and disability agencies Uncertainty of The • Litigation pending before the U.S. Supreme Court Affordable Care Act • Many states are reluctant to commit to ACA programs (ACA) AARP 3
Budget Context States Continue to Struggle through Tough Economy AARP 4
Recession Remains a Significant Factor Major General Fund revenue sources (PI, Corp, and Property Tax) below pre- recession levels for most states 28 states still project 2012 tax revenues below 2007 pre-recession levels 22 states are now projecting collections above 2007 levels While revenues are down, states must contend with increasing service demand AARP 5
Percent Change in State Tax Revenue 2007 (actual) to 2012 (projected) Personal Income, Corporate, and Property Taxes WA NH VT ME MT ND MA MN OR ID SD WI NY MI RI WY CT PA IA NE NJ NV IN OH DE UT IL CO MD WV CA KS VA MO KY NC TN AZ OK Percent Change NM AR SC GA MS -25.7% to -15% AL LA TX -14.9% to -10% -9.9% to -5.0% FL AK -4.9% to - 0.1% 0% to 9.9% HI 10%+ Source: HMA analysis of data from National Association of State Budget Officers (NASBO), Spring Fiscal Survey of States, 2007-2010 reports, and Fall 2011 Report for 2012 Notes: 2012 figures are enacted . For Illinois, this map uses projected revenue from NASBO’s 2006 report because 2007 data was not available. AARP 6
Medicaid Impact of the Recession on Medicaid Funded LTSS AARP 7
States are Transforming LTSS Delivery and Finance Increased interest in Medicaid Managed LTSS • 12 states with existing programs • 11 states plans to implement in 2012 or 2013 • Half plan to implement statewide • About 2/3 have or will require mandatory enrollment – but half of these will allow an opt out Increased focus on Dual Eligible service integration • At least 28 states report efforts to integrate Medicare and Medicaid services for “duals” Plans for HCBS Waivers Consolidation • 15 states considering for administrative and programmatic simplification AARP 8
U.S. Medicaid Enrollment Increases in Economic Downturns Aged and Disabled enrollment largely unaffected by economic fluctuations, but…. may prompt Enrollment states to curtail increase in other LTSS optional groups creates services fiscal stress Enrollment increases likely contribute to LTSS policy decisions AARP 9
U.S. Medicaid Enrollment Growth Shows Signs of Slowing Annual growth rate FY 1998-FY 2012 (projected) Source: “Moving Ahead Amid Fiscal Challenges: A Look at Medicaid Spending, Coverage and Policy Trends: Results from a 50-State Medicaid Budget Survey for State Fiscal Years 2011 and 2012;” Vernon K. Smith, Kathleen Gifford, Eileen Ellis, et.al.; Kaiser Commission on Medicaid and the Uninsured; October 2011. Note: Enrollment percentage changes from June to June of each year. AARP 10
Loss of Federal ARRA FMAP Results in 24% Increase in FY 2012 State Medicaid Funding Annual Growth in Total and State Medicaid Spending, 2000-2012 Total State General Fund 23.7% 0.23 ARRA Enhanced FMAP (2009-2011) 0.18 12.9% 12.7% 0.13 10.1% 10.4% 9.9% 10.3% 8.7% 8.5% 8.4% 7.7% 7.6% 7.3% 0.08 6.6% 6.4% 5.8% 5.7% 5.5% 4.9% 4.0% 3.8% 3.0% 2.2% 0.03 1.3% -0.02 Enhanced FMAP / Federal Fiscal Relief (2003-2005) -4.9% -0.07 -0.12 -10.9% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Adopted Source: “Moving Ahead Amid Fiscal Challenges: A Look at Medicaid Spending, Coverage and Policy Trends;” Vernon K. Smith, Kathleen Gifford, Eileen Ellis, et.al.; Kaiser Commission on Medicaid and the Uninsured; October 2011. NOTE: State Fiscal Years. AARP 11 AARP
Nearly half of states have or are planning Medicaid Managed LTSS Programs WA NH VT ME MT ND MA MN OR ID SD WI NY MI RI WY CT PA NE IA NJ NV IN OH DE UT IL CO MD WV KS VA CA MO KY NC TN AZ OK AR Percent Change NM SC GA MS Existing Program AL (in 2010 or 2011) LA TX Plan to Implement in 2012 FL AK Plan to Implement in 2013 HI New Hampshire released a request for proposal (RFP) in October 2011, after the survey was completed. Although the state did not indicate plans to implement an MMLTSS program on the survey, the RFP includes the nondual aged and disabled as a mandatory population in its managed care program, and dual eligibles as a voluntary population for July 1, 2012. The state is also seeking a waiver to include dual eligibles as a mandatory group in managed care. AARP 12
Most states have or plan statewide implementation Geographic Area of Medicaid Managed LTSS Programs n = 23 7 6 6 5 5 5 Number of States 4 4 3 2 2 1 1 0 Existing MMLTC Programs Planned MMLTC Programs Statewide Limited geographic area Pilot program only Undecided AARP 13
Enrollment Requirements • Most states have Enrollment Requirements for MML TSS n = 20 either voluntary enrollment or 20% mandatory with 15% 35% opt out option 30% • However, 6 require enrollment Mandatory with an opt out Mandatory with no opt out Voluntary opt in Other with no opt out Note: One state is represented in data for both Mandatory with an opt out, and Voluntary opt in. AARP 14
Indication of strong interest to integrate MMLTSS programs for people enrolled in Medicare and Medicaid (“Duals”) Integration for People Enrolled in Medicare and Medicaid in MMLTSS n = 23 22.7% Program currently integrates both 45.5% State plans to integrate both 22.7% No integration currently or planned 9.1% Under consideration AARP 15
Most states increased HCBS waiver expenditures in 2011 Percentage Range of Increases in HCBS Expenditures 2010 to 2011 12 10 8 Number of States 6 10 9 4 6 2 2 0 Less than 5% 5%-8% 8-15% More than 15% AARP 16
Most states increased the number of individuals served through HCBS waivers… Changes in HCBS Caseload From Previous Year 27 2011 3 7 Increased Decreased 31 Stayed the same 2012 0 6 0 5 10 15 20 25 30 35 Number of States AARP 17
….while Medicaid nursing facility census is expected to decrease or remain static States Reporting Nursing Facility Census Change: FY 2011 to FY 2012 n=37 Increase Stay the Same Decrease 5 15 17 0 2 4 6 8 10 12 14 16 18 Number of States AARP 18
Aging and Disability Programs Impact of the Recession on non-Medicaid Funded LTSS AARP 19
Reductions in non-Medicaid State Aging and Disability Agency Budgets, SFY 09 - 12 18 SFY 09 (n=36) 16 14 SFY 10 (n=31) 12 10 Number of States SFY 11 (n=14) 8 6 SFY 12 (n=11) 4 2 0 5% or less 6-10% 11-15% 16-20% 21-25% Over 25% Percent Reduction from Previous Year Source: AARP, HMA, NASUAD Economic Survey, FY 10, FY11. FY09 data is from NASUA Economic Survey, December 2009. AARP 20
SFY 2012 Non-Medicaid State Aging and Disability Agency Budget Actions AARP 21
Current and Planned Savings Strategies, SFY 11 –12 60% 50% Percent of States 40% 30% 20% 10% 2011 0% 2012 AARP 22
Programs with Increased Service Demands, SFY 2011 Information and Referral Aging and Disability Resource Center Respite Transportation Home-Delivered Meals Adult Protective Services Long Term Care Ombudsman Family Caregiver Support Alzheimer's Support Program Personal Care/Assistance Case Management State Health Insurance Assistance Program (SHIP) Homemaker Legal Assistance Development Community Transition from Nursing Homes Adult Day Services Senior Centers Chore SCSEP Elder Abuse Prevention Supplemental Nutritional Assistance Program (SNAP) Home health care Disease Prevention/Health Promotion Congregate Meals Senior Medicare Patrol Senior Farmers' Market Nutrition Program (SFMNP) Kinship Care Environmental Modifications Emergency response systems Assisted Living Low-Income Home Energy Assistance Program (LIHEAP) Housing Assistance Traumatic Brain Injury Program 0 5 10 15 20 25 30 Number of States AARP 23
Decreased Service Expenditures for Non-Medicaid Programs, SFY 10-11 and SFY 11-12 25 SFY 10-11 SFY 11-12 20 Number of States 15 10 5 0 AARP 24
Affordable Care Act Many states report uncertainty about pursuing provisions within the Affordable Care Act due to pending litigation in the U.S. Supreme Court and lack of final federal guidance on implementation. AARP 25
Indications of Intent to Pursue Selected Affordable Care Act Options 45 40 2 3 35 5 14 30 Number of States 21 25 22 Definitely Plan to Implement 18 Under Consideration 20 Don't Know 16 Definitely Plan Not to Pursue 15 9 10 6 8 5 10 7 6 6 0 Balancing Incentive Section 1915(i) Community First Health Home State Payments Program State Plan Option Choice Option Plan Option AARP 26
State Outlook What to expect in 20122 AARP 27
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