Is Medicaid Really Biased?
So often, when families call in the midst of a long term care crisis, their primary concern, they tell us, is to care for their loved one at home. For some that will be impossible, as their medical needs require nursing home care. But, for others, home care is possible. The problem is Medicaid’s bias towards institutional care.
What do we mean by that? First of all, when we talk about Medicaid, we aren’t talking about one single program. Medicaid actually consists of a number of different programs under the “Medicaid umbrella”. All are needs based programs, meaning there are strict financial tests, but there are some significant differences in the rules from one to the next. An important difference is that when one meets all the eligibility requirements for institutional Medicaid (care administered in a nursing home or state institution) the state must cover the applicants care costs.
That is not true for home based and other community Medicaid programs. Most states limit the number of residents for whom those benefits will be provided, resulting in lengthy waiting lists. If you have spent all your money down to qualify for Medicaid at home you could wind up on a waiting list. And if you can’t wait because your health is at risk then your only alternative is to go to a nursing home. That is how the system “drives people to institutional care”.
In recent years there has been increasing discussion about whether this “bias” is what the government really wants. Isn’t it less expensive to administer care at home, which would then cost the state less money ? That is a debate that you’ll hear more of as the federal and state governments struggle with budget deficits and trying to keep costs down. We are already seeing, in the past 5 to 10 years, an increase in state spending on home and community based programs. But some lawmakers fear what they call the “woodwork effect”. If they expand these programs, giving people what they want, more will be encouraged to apply and thus, the costs will rise. People will be “coming out of the woodworks”, so to speak. (Makes you wonder how much the government really cares.)
That premise is debatable. A 2009 University of California study found that expanding home based care programs saved states money in the long run. There were additional “start up” costs but over time the additional expense paid for itself because, the study found, the cost of home care is cheaper than institutional care.
As we see 77 million baby boomers starting to turn 65 the discussion will only intensify. The long term care problem isn’t going away. For more discussion on the issue check out a recent story on National Public Radio which you can find at http://www.npr.org/2010/12/10/131755491/home-care-might-be-cheaper-but-states-still-fear-it