Unbiased Analysis of Today's Healthcare Issues

Medicaid and Long-Term Care Services

Written By: Jason Shafrin - Nov• 17•10

The increased use of long-term care (LTC) services has been one of the forces increasing health care cost and utilization.  Currently, 10.3 million Americans use LTC services.  The Kaiser Family Foundation provides a summary of LTC Services and Supports in the U.S.

Who uses LTC?

One can divide LTC services into those who receive care in the community (a.k.a at their home) compared to those who are institutionalized in a nursing home.  The vast majority of individuals receiving LTC services are community based (8.8 million) and these individuals are roughly divided equally between the elderly (4.6 million) and non-elderly (4.2 million).  Nursing home residents, on the other hand, are mostly elderly (87% of the 1.5 million nursing home residents).

Elderly individuals often require assistance from the symptoms of diseases such as Alzheimer’s, diabetes, pulmonary diseases, and other severely disabling chronic diseases.  Many children also require LTC services.  Examples include children with mental retardation, developmental disabilities (e.g autism), spinal cord injuries, traumatic brain injuries, and serious mental illness.

These individuals receive services that “range from providing assistance with eating, dressing, and toileting, to assisting with managing a home, preparing food, and medication management.”

Who pays for LTC?

In 2008, LTC services cost $177.6, of which $124.9 billion was spent on nursing home care.  “Nursing home care averages $70,000 per year, assisted living facilities average $36,000 per year, and home health services average $29 per hour.”

Although Medicaid pays for the largest share of services, benefit eligibility is limited. Eligibility for Medicaid nursing home benefits are often tied to SSI eligibility. “Additionally, elderly and disabled individuals who qualify for Medicaid must have very few assets ($2,000 for an individual and $3,000 for a couple, in most states).” Some states exclude home equity in this asset maximum while others do not.

What Does Medicaid Provided
“Over 3 million individuals, or 7 percent of the Medicaid population, rely on Medicaid long-term care services for a range of physical and mental health care needs. Over half of those who use Medicaid long-term care services are individuals age 65 and older, but 45 percent are disabled children and adults.”

Home and community based care (HCBS) has been growing as a share of Medicaid expenditures over time.

“Spending patterns for Medicaid home and community-based services vary widely among states although demand for services in the community is growing as evidenced by the number of beneficiaries on waiting lists for home and community-based waiver services – 331,689 individuals in 33 states in 2007 – an 18 percent increase over the previous year.”

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