Boosting Home Care: An Uphill Battle

Jun 22, 2009

View all previous columns »

Once a senior begins receiving long-term care services, she and her family often are in for two shocks. The first is that Medicare won’t pay beyond perhaps a few months after a hospitalization. The second is that while Medicaid, the state-federal program for the poor, may help, chances are it will only do so for nursing home residents.

Now, as part of the broader health reform debate, Congress may be about to make it easier for families to keep their loved ones at home, even if they are getting Medicaid. Under one plan, backed by Sen. Tom Harkin, D-Iowa, states would have to offer the same access to home care as they do for nursing facilities. A second, more modest bill, sponsored by Sens. John Kerry, D-Mass., and Charles Grassley, R-Iowa, would make more disabled and frail elderly eligible for home care and provide extra federal funding for states that create generous home care programs. The “Empowered at Home Act,” which probably has a better chance than the Harkin bill, would not require states to offer these benefits.

These bills have been a long time coming. Ten years ago, the Supreme Court ordered states to provide those with disabilities equal access to community-based care. Yet, there is no requirement that Medicaid provide financial support for those living at home, in group homes or assisted living facilities. States may do so, but often the assistance is too meager.

The problem is that cash-strapped states don’t want to spend the money to provide this care, or they don’t want to jump through the federal government’s hoops. The result: states either limit the services they’ll pay for, or people end up on long waiting lists before they become eligible for home care benefits. In Maryland, for example, the wait for seniors is more than two years. Many die before they reach the top of the list.

Medicaid’s focus on institutional care is changing, but slowly. According to AARP, in 2007 three-quarters of Medicaid’s long-term care dollars for the frail elderly and disabled adults were still being paid to nursing facilities. More than 90,000 Medicaid beneficiaries were on home care waiting lists, and only five states spent more than half of their long-term care dollars on home care.

Why are states so reluctant to change? One reason may be cost. At first, it seems as if staying home is less expensive than living in a nursing home. But for those who need a high level of care—the usual standard for Medicaid eligibility—that may not be true.

And even if the per beneficiary cost is lower, the total cost of the program may be higher. That’s because of the unfortunately named “woodwork effect.” The idea is that today, many families care for loved ones at home without paid assistance. If they can get Medicaid dollars to hire aides, they will come out of the “woodwork” and do so, raising the overall cost to the state.

Nobody seems to agree how powerful this effect is. State officials such as Patrick Flood, who runs Vermont’s home care program, insist it is a myth. Others are terrified of what will happen to their budgets if they open the doors to home care. Nervous state officials want Washington to put up as much as $5 billion a year to help offset their costs. And because it will take new federal dollars to give home care a needed boost, supporters will have to compete with a hundred other health reform ideas for money.

In an ideal world, states would provide care to Medicaid recipients in the setting that is most appropriate for them, whether it is at home, in a group home, or in a nursing facility. But until advocates can prove this care is better for patients and can save money in the long run, they are going to have an uphill battle. My best guess is that Congress will take some welcome steps to improve access to community care, but not go as far as many would like.

Howard Gleckman, a senior research associate at the Urban Institute, is author of Caring For Our Parents and a frequent writer and speaker on long-term care issues.