VHCA Distributes Long Term Care Study

VHCA facility members will soon be receiving a report for the recently completed study conducted by Fiscal Analytics, Ltd. titled Comparing Long Term Care Settings – The Potential for and Cost of Discharging Nursing Facility Residents to Home and Community-Based Care.  This independent study commissioned by the association attempts to answer the question, “Could a significant number of Virginia Medicaid nursing facility residents be cared for at an equal or reduced expense to the Commonwealth in their home or other community-based option?”  In addition to providing the report to facility members, the report has been mailed to a comprehensive list of state legislators, policymakers and senior staff of the Department of Medical Assistance Services.

To answer the question, the study reviewed the Minimum Data Set (MDS) records of over 73,000 unique Virginia nursing facility residents during 2005.  The study focused on almost 18,000 Medicaid nursing facility residents that had a full MDS assessment conducted in 2005.  The study compares real costs in various settings and determines the number of current nursing facility residents that might be taken care of in a home or community-based setting.

Major findings of the study include:  (1) only about 1.3% of all nursing facility residents have over a 50% likelihood of discharge from a nursing facility due to their need for intensive health care and available assistance at home or in the community; (2) the availability of an informal caregiver is the single most important factor in determining the probability for discharge back to the community; (3) home and community-based services for nearly 99% of 2005 Virginia Medicaid nursing facility residents would be two to three times more expensive than nursing home care; and (4) home and community-based services are less costly than facility-based care only when the state is not paying for bed and board and when informal/family caregiver support exists for individuals with generally less severe physical and cognitive conditions.

The study also reveals the actual cost of care for Medicaid long term care to the Commonwealth of Virginia’s General Fund to be only $50 per day for the average nursing home resident and $40 per day for participants in the existing pre-PACE program.  Other community programs varied greatly in their costs.  The state share of the per diem Medicaid amount ($50) for nursing home care takes into consideration the impact of “patient pay” offsets which serve to lower the actual state support expenditure by requiring that Medicaid beneficiaries assign income from sources such as social security to cover the cost of their care and the fact that 50% of Medicaid outlays in Virginia come from Federal sources.

We recognize that the Olmstead decision, along with federal initiatives such as Money Follows the Person and Real Choice Systems Change Grants demonstrate a desire for people needing Medicaid long term care services to be given the option of Medicaid sponsored care in community settings.  If additional Medicaid long term care funds are to be allocated to home and community-based care, it should be done to expand options for Medicaid recipients and not as a cost saving strategy for Medicaid.  Given the strict Medicaid nursing home admission criteria in place in Virginia, the study confirms the fact that few nursing home eligible Medicaid recipients can be cared for more effectively, efficiently or inexpensively in other settings.

As baby boomers age, the number of people needing long term care services will dictate an increase in the overall costs to society.  All provider settings within long term care will be called upon to keep up with the demand for services.  Innovative policies will be needed to care for the frail and elderly in the most efficient and cost-effective setting.  It is our hope that this study will provide objective information to assist those responsible for making the policy decisions that we will face in the months and years ahead.

There are a limited number of additional copies of the report which are available upon request.  Please contact VHCA at 804.353.9101 if you would like a paper copy of the study report.  Electronic copies of the report are available for download in Adobe Acrobat format.  In addition, slides developed by the study consultant to summarize the report are also available for download.  If you have any questions about the study, please contact Steve Morrisette at 804.212.1691 or steve.morrisette@vhca.org.