Policy Research Shop Support for the Policy Research Shop is provided by the Fund for the Improvement of Postsecondary Education, U.S. Department of Education. Policy Research Shop By: Michael Sanchez, Natalia Agredo, and Will Bishop Long-Term Care in Grafton County Shifting from Institutional to Community-Based Care The contents of this report were developed under grant P116B from the U.S. Department of Education. However, these contents do not necessarily represent the policy of the U.S. Department of Education, and you should not assume endorsement by the Federal Government.

Policy Research Shop Institutional Care vs. HCBS How can stakeholders make HCBS cost effective?

Policy Research Shop 1915 Waivers 1915(i) Waivers: – Provide HCBS under regular Medicaid plan 1915(b) Waivers: – Combine Medicare and Medicaid funding for HCBS 1915(c) Waivers: – Target HCBS services to specific populations

Policy Research Shop Moral Hazard The Woodwork Effect – Increased participation – Incentive to receive HCBS over free family care Increases overall costs despite decreased per capita costs

Policy Research Shop Choices for Independence (CFI) Options for institutional care or HCBS – Screening program (NHBAES) Wide range of services offered – Does not include emergency services

Policy Research Shop Best Practices State Programs – ALTCS – PACE – Arkansas National Studies – Kaye, et al. – Amaral – Kitchener, et al.

Policy Research Shop Arizona Long Term Care System (ALTCS) Program: – Mandatory program enrollment – Pools costs, allows for control of expenditures Outcomes: – Substantial increase in HCBS use – Quality of care decreased

Policy Research Shop Program for All-Inclusive Care for the Elderly (PACE) Program: – Managed and Capitated Care – Avoid fee-for-service Moral Hazard – Use 1915(b) waiver to pool Medicaid and Medicare funding Outcomes: – Cost growth lower on average

Policy Research Shop Arkansas Community Connector Program Program: – Employ Community health workers – Identify at-risk populations Outcomes: – 30% decrease Medicaid spending compared to control – Partially offset by non-health costs

Policy Research Shop Kaye, et al. Study Design: – High-Low HCBS states – Expanding-Established HCBS states Findings: – Yields initial increase in per capita spending – Subsequent downward trends Long-term state savings Kaye, H. Stephen et al. “Do Institutional Long-Term Care Services Reduce Medicaid Spending?” In Health Affairs, vol. 28 (2009): acc. February 20, 2012

Policy Research Shop Amaral Study Design: – Studied 1915(c) waivers – Fixed effects for state and year ( ) – Regresses Medicaid spending on waiver participants, controls Findings: – No evidence of cost shifting from institutional to HCBS Amaral, Michelle. “Does substituting home care for institutional care lead to a reduction in Medicaid expenditures?” In Health Care Manag. Sci. (2010): 309&cfc=1&TS= &clientId=4347 acc. February 20, 2012

Policy Research Shop Kitchener, et al. Study Design: – Also studied 1915(c) waivers; 2002 data – Compares HCBS and institutional – No time-series component Findings: – For all waivers, per capita savings of $43,947 – For nursing home level, per capita savings of $15,489 Martin Kitchener PhD, Terence Ng MA, Nancy Miller PhD & Charlene Harrington PhD (2006): Institutional and Community-Based Long-Term Care, Journal of Health & Social Policy, 22:2, 31-50

Policy Research Shop Other Considerations Relax eligibility restrictions – Increase Medicaid’s share of HCBS costs – Raise total demand for HCBS Where do funds come from during the shift? – Cut nursing home funding, decrease quality – Other sources

Policy Research Shop Future of Long-Term Care Survey of experts – Expanding HCBS under Medicaid supported – Reducing nursing home beds not supported Role of nursing homes in promoting HCBS

Policy Research Shop Applying Academic Research Use community outreach to recruit at-risk individuals Implement capitated care, cost pooling Mandate enrollment

Policy Research Shop Thank You!