Rebalancing Long-Term Services and Supports: Progress to Date and a Research Agenda for the Future June 14, 2011 Charles J. Milligan, Jr. Cynthia H. Woodcock Long-Term Care Interest Group Colloquium
Overview Progress in rebalancing long-term services and supports (LTSS) The challenges states face Rebalancing strategies Opportunities in the Affordable Care Act (ACA) A research agenda -2-
Progr Progress ess in in Rebalancing Rebalancing LTSS LTSS -3-
Medicaid finances 41% of nursing facility expenditures in the U.S. … All Medical and Nursing Facility Revenue Sources, 2008 Other Payment Source Medicaid 16.2% 40.6% 83.8% 59.4% All Medical Expenditures Nursing Facilities Source: National Center for Health Statistics. Health, United States, 2010: With Special Feature on Death and Dying. Hyattsville, MD. 2011. -4-
… and Medicaid is the primary payer for two-thirds of nursing facility residents Distribution, by Primary Payer, of Payments for Nursing Facility Residents in the United States, 2007 Medicare 14% Medicaid 64% Other 22% Source: Houser, A; Fox-Grage, W; & Gibson, MJ. 2009. Across the States: Profiles of Long-Term Care and Independent Living. AARP. -5-
Why rebalance? “Rebalancing” refers to moving away from a dependency on institutional care toward a system of comprehensive community- based LTSS Several factors are driving states’ efforts to rebalance … -6-
Spending on nursing facilities continues to increase, which burdens state Medicaid budgets … Medicaid Spending on Nursing Facilities in the United States: Older Adults and Persons with Physical Disabilities, 2004-2009 ($ Billions) $51 $50 $49 $48 $47 $46 $45 $44 $43 2004 2005 2006 2007 2008 2009 Source: National and State Long-Term Care Spending for Adults Aged 65 and over and Persons with Physical Disabilities. 2011. Analysis of Thompson Reuters data by The Hilltop Institute. -7-
. . . the per capita cost of serving individuals in community-based settings is cost-effective . . . Per Member Per Month (PMPM) LTSS Expenditures for Institutionalized Individuals in Maryland Who Transitioned to an HCBS Waiver, FY 2008 – FY 2010 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 Living at Home Waiver Medical Day Care Waiver Older Adults Waiver : Older Adults Waiver : Assisted Living Individual Residence Pre-Transition Institutional PMPM Post-Transition HCBS PMPM Source: Hilltop Analysis of Maryland MMIS Data: Average 12 month pre-and post-transition Medicaid expenditures. MFP Metrics 2010. -8-
… the population of older adults is growing … Percentage of the U.S. Population Aged 65 and Older 2007 (Actual) and 2030 (Projected) 25% 20% 15% 2007 10% 2030 5% 0% Age 65+ Age 65-74 Age 75-84 Age 85+ Source: Houser, A; Fox-Grage, W; & Gibson, MJ. 2009. Across the States: Profiles of Long- Term Care and Independent Living. AARP. -9-
… people prefer to remain at home or in the community … Long-Term Care Preferences by Caregiver Type and Location 100% 90% 80% 70% 60% 50% Very Disagreeable 40% Somewhat Disagreeable 30% Somewhat Agreeable Very Agreeable 20% 10% 0% Your family in Your family in Paid A resident of A resident of a your home their home caregivers in an assisted nursing home your home or living facility community Source: Eckert, JK; Morgan, LA; & Swamy, N. 2004. Preferences for Receipt of Care Among Community- Dwelling Adults. Journal of Aging and Social Policy. 16(2):49-65. -10-
. . . and civil rights efforts in the ADA and the related Olmstead decision promote rebalancing. The Americans with Disabilities Act (ADA), enacted in 1990, requires public programs to reasonably accommodate people with disabilities in order to prevent discrimination. Title II of the ADA was interpreted in the 1999 U.S. Supreme Court Olmstead decision, which defines institutionalization as a form of discrimination, and segregation from the broader community. Olmstead requires Medicaid to serve individuals in community-based settings when it is safe to do so and when the individual wants to be served there. One exception: a state need not “fundamentally alter” its programs; e.g., a state is not required to create a new program. -11-
Overall, substantial progress has been made in rebalancing Medicaid spending for LTSS Percentage of Medicaid LTSS Spending for Institutional Care versus Home and Community-Based Services (HCBS), United States 80% 70% 60% 50% 40% 30% 20% 10% 0% 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 HCBS Institutional Source: Thomson Reuters -12-
The greatest gains in rebalancing have been for persons with ID/DD … Percentage of Medicaid LTSS Spending for Institutional Care versus HCBS for Persons with Intellectual and Developmental Disabilities (ID/DD), United States 70% 60% 50% 40% 30% 20% 10% 0% 2004 2005 2006 2007 2008 2009 HCBS Institutional Source: Thomson Reuters -13-
… while rebalancing for older adults and persons with physical disabilities lags far behind. Percentage of Medicaid LTSS Spending for Institutional Care versus HCBS for Adults Aged 65 and Older and Persons with Physical Disabilities, United States 80% 70% 60% 50% 40% 30% 20% 10% 0% 2004 2005 2006 2007 2008 2009 HCBS Institutional Source: Thomson Reuters -14-
10% 20% 30% 40% 50% 60% 70% 80% 0% tremendous variation across states . . . national level, there remains Even as progress has occurred on a New Mexico Washington Minnesota Oregon Alaska California Percentage of Medicaid LTSS Spending for HCBS for Adults Aged 65 and Older Washington DC Texas Colorado Idaho North Carolina Kansas New York and Persons with Physical Disabilities by State, 2009 Massachusetts Source: National and State Long-Term Care Spending for Adults Ages 65 and over and Persons with Physical Virginia Nevada Montana Missouri Vermont Louisiana Oklahoma Iowa Arkansas South Carolina -15- Georgia Wisconsin Disabilities. 2011. Analysis of Thompson Reuters data by The Hilltop Institute. West Virginia Nebraska Maine Connecticut Ohio Wyoming Michigan Arizona New Jersey Florida Illinois Utah Kentucky Hawaii Pennsylvania National Average = 33.8% New Hampshire Indiana Mississippi Maryland Alabama South Dakota Delaware North Dakota Tennessee Rhode Island
-40% -30% -20% -10% 10% 20% 30% 40% 0% across states. years also has varied a great deal . . . and progress over the past five Washington DC Louisiana Minnesota Virginia Washington Adults Aged 65 and Older and Persons with Physical Disabilities, FY 2004 – FY 2009 New Mexico Georgia Change in the Percentage of Medicaid LTSS Spending for HCBS by State: Massachusetts Oklahoma Pennsylvania Colorado Kansas Montana Florida Source: National and State Long-Term Care Spending for Adults Ages 65 and over and Persons with Physical South Carolina Arkansas Iowa Nevada Tennessee Indiana California Ohio Michigan -16- Nebraska Utah Disabilities. 2011. Analysis of Thompson Reuters data by The Hilltop Institute. Missouri North Carolina Idaho Wyoming Alaska New Hampshire South Dakota North Dakota Oregon Alabama Connecticut Hawaii New York West Virginia Maine Texas National Average = 6.8% Wisconsin Delaware Illinois Kentucky New Jersey Arizona Maryland Rhode Island Mississippi Vermont
What What are t are the he Major Challenges Major Challenges Stat States es Confront Confront in in Rebalancing Rebalancing LTSS? LTSS? -17-
Medicaid’s “institutional bias” is a serious impediment Beneficiaries are entitled to nursing facility care, but states can choose whether to offer HCBS waivers Individuals with incomes above 300% of the SSI may qualify as a spend-down eligible in a nursing facility (because the room & board embedded in the institutional per diem is considered a medical expense), but not in community-based LTSS (because rent is not) Automatic annual increases in nursing facility rates contribute to institutional bias -18-
Rebalancing depends on direct care workers, but low wages deter growth in this employment sector Median Hourly Wages for Personal and Home Care Aides and Home Health Aides $12.00 $10.00 $8.00 $6.00 $4.00 $2.00 $0.00 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Home Health Aides: Nominal Hourly Wage Personal and Home Care Aides: Nominal Hourly Wage Home Health Aides: Real Hourly Wage (1999 Dollars) Personal and Home Care Aides: Real Hourly Wage (1999 Dollars) Source: U.S. Bureau of Labor Statistics -19-
States face other challenges in rebalancing Medicaid LTSS “Back - filling” of nursing facility beds Transforming institutional care in response to consumer needs and preferences Availability of affordable housing in the community -20-
Rebalancing Rebalancing Str Strategies ategies -21-
States use a variety of strategies to promote rebalancing LTSS in the Medicaid state plan (home health, personal care, 1915(i) amendments) 1915(c) HCBS waivers Integrated care (Medicare-Medicaid) Consumer direction Federal Money Follows the Person demonstration Nursing home diversion programs Aging and Disability Resource Centers (ADRCs ) -22-
Opportunities Opportunities in in the Affordable the Affordable Care Care Act Act -23-
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