Are Seniors More Likely To Enroll In Medicaid If States Expand Home-Based Long-Term Care?

Whereas many states have expanded their Medicaid residence and community-based companies (HCBS) for frail older adults, others proceed to steer many enrollees into nursing houses. One massive motive: They worry that enhancing residence helps will encourage extra older adults to enroll in Medicaid long-term care companies (LTSS) and enhance state prices.

However a brand new research revealed within the Journal of the American Geriatrics Society finds that this “woodwork impact” (as in, folks will come out of the woodwork to enroll in Medicaid) is essentially a fantasy. Examine authors Brian McGarry of the College of Rochester Faculty of Medication and David Grabowski of the Harvard Medical Faculty discovered no hyperlink between elevated HCBS funding and elevated Medicaid enrollment amongst older adults —the woodwork impact some state Medicaid officers worry.

Certainly, the research, which expands on and confirms the outcomes of a number of older experiences (right here and right here), concludes that rising funding for HCBS could be less expensive because it lowers total Medicaid long-term care bills relative to the nursing residence different.

It might occur this manner: Whereas individuals are extra prone to obtain residence care if states broaden Medicaid HCBS funding, many who could be newly helped already are enrolled in Medicaid however receiving few if any long-term care advantages. And that places them at higher threat of getting to maneuver to a nursing residence. By rising their entry to HCBS, Medicaid may help them to remain residence for longer and decrease state nursing residence bills.

Price Financial savings

The authors estimate that each $1 states spend to extend Medicaid HCBS ends in a $0.26 decline in Medicaid nursing residence spending.

Put one other manner, a 10-percentage level enhance in HCBS spending lowered the nursing residence inhabitants by 2 % and lowered state spending on institutional care by about 7 %.

States can use financial savings to make long-term helps and companies accessible to extra enrollees or enhance advantages to these already receiving assist. McGarry and Grabowski discovered that each $1 million enhance in Medicaid HCBS spending was related to 31 extra enrollees receiving home-based care. Thus, the research concludes, “Elevated HCBS…spending was related to extra older adults receiving LTSS at a decrease price per beneficiary served relative to the nursing residence setting.”

One instance: To preserve assets, many states restrict the quantity of people that can obtain Medicaid HCBS companies at anybody time. Thus, lots of of hundreds of Medicaid enrollees are ready to obtain such advantages. However the authors estimate a state might shift three folks from these ready lists for the price of one nursing residence mattress.

A Pure Experiment

The research examined Medicaid long-term care spending in 45 states and the District of Columbia from 1999-2017. Total, states have considerably expanded their HCBS packages in order that by 2019, nearly 60 % of Medicaid LTSS budgets have been spent on home-based care, triple the share in 1995. However there stays nice variation amongst states. For instance, in 2019, Mississippi Medicaid spent solely about one-third of its long-term care price range on home-based care whereas Minnesota spent greater than three-quarters.

That variation created a precious pure experiment: Did states that expanded HCBS see higher-than-expected progress in Medicaid long-term care enrollment?

The research centered solely on Medicaid individuals who have been age 65 or older. It excluded youthful folks with mental and developmental disabilities who account for a big share of Medicaid LTSS spending. Nevertheless, the overwhelming majority already obtain care at residence or in group houses reasonably than in nursing amenities.

Whereas the authors relied on newer information than earlier research, they nonetheless needed to work with Medicaid info from 1999-2017. In consequence, their evaluation doesn’t replicate important will increase in assisted dwelling and non-nursing facility reminiscence care that occurred in the course of the interval (little or no of which was paid by Medicaid). Nor does it replicate modifications that occurred in the course of the Covid-19 pandemic.

The Proper Stability

The federal authorities pays for greater than 60 % of Medicaid prices, although the federal share varies by state. States have broad flexibility in the best way they function their Medicaid packages, although they want a particular waiver from the federal authorities to run home-based packages.

There could also be many the explanation why low-income frail older adults fail to take part in Medicaid HCBS packages. They might want extra care than they will obtain at residence or could also be unable to navigate an awfully advanced care system. And even in states with a sturdy HCBS profit, it nonetheless could also be unimaginable for a frail older grownup to remain at residence with out the energetic assist of a household caregiver.

That implies Medicaid nonetheless must assist facility-based care. However states can present extra assist in the setting folks need, whereas getting an even bigger bang for his or her Medicaid buck by enhancing home-based care. And, if McGarry and Grabowski are proper, they will do it with out producing a pricey wave of latest Medicaid enrollments.