Long-Term Care: Exploring the Possibilities

1. Long-Term Care: Exploring the Possibilities Diane Rowland, Sc.D. Executive Vice President, Henry J. Kaiser Family Foundation and Executive Director, Kaiser Commission on Medicaid and the Uninsured for Alliance for Health Reform Washington, DC March 9, 2009

2. Who Pays for Long-Term Care? Total Long-Term Care Expenditures Nursing Home Care Expenditures Total = $177.6 billion Total = $124.9 billion Note: Total LTC expenditures includes only spending on nursing home and home health services. Some community-based services financed primarily through Medicaid home and community-based waivers and delivered in other settings are not represented here. SOURCE: KCMU estimates based on CMS National Health Accounts data, 2008.

3. Medicaid Long-Term Care Users Account for 7 Percent of Enrollees But Over Half of Spending Enrollees Expenditures 48% 93% 19% 52% 33% 4% 3% Total = 51.4 million Total = $228.2 billion Note: Data include spending on acute and long-term care services by users. Source: KCMU and Urban Institute estimates based on MSIS 2002.

4. Dual Eligibles’ Share of Medicaid Enrollment and Spending, FFY 2005 $ 287.3 billion 49.8 million Source: Urban Institute estimates based on data from MSIS and CMS Form 64, prepared for the Kaiser Commission on Medicaid and the Uninsured, 2008.

5. Comparison of Dual Eligible and Other Medicare Beneficiaries, 2006 61% Total = 7.5 Million Dual Eligible Medicare Beneficiaries SOURCE: KFF analysis of the Medicare Current Beneficiary Survey 2006 Access to Care File.

6. Growth in Medicaid Long-Term Care Expenditures, 1991-2006 In Billions: $109 $100 $92 Home & community-based care $75 41% 37% 32% Institutional care 30% $54 20% $32 70% 68% 63% 59% 13% 80% 87% Note: Home and community-based care includes home health, personal care services and home and community-based service waivers. SOURCE: KCMU and Urban Institute analysis of HCFA/CMS-64 data.

7. Reform Options at the State Level • Home and community-based services (HCBS) waivers • Demonstration grants with enhanced matching funds • HCBS State Plan Options • Allows states to offer HCBS services as a state plan option rather than through a 1915(c) waiver • Self-direction of personal assistance services • Medicaid beneficiary has greater control over hiring, scheduling and paying personal care attendants • Long-term care Partnership Programs • Allow persons who purchase qualified LTC insurance policies to shelter some or all of their assets when applying for Medicaid after exhausting their policy benefits

8. Number of States with Medicaid Long-Term Care Expansions Note: State actions to expand HCBS waivers include those receiving Money Follows the Person demonstration grants. SOURCE: KCMU survey of Medicaid officials in 50 states and DC conducted by Health Management Associates, September 2008.

9. Increased Flexibility with DRA Long-Term Care Options Number of States SOURCE: KCMU survey of Medicaid officials in 50 states and DC conducted by Health Management Associates, September 2008.

10. Key Challenges in Long-Term Care • Medicare coverage for long-term care is limited • Provides limited nursing home care (100 days) for those recently discharged from a hospital • Better coordination of dual eligibles is needed • Private sector options are still limited and often costly • The demand for long-term care will continue to grow and families will continue to play a critical role in provision of care and financing home care and nursing home care