LTC Bullet: Medicaid and LTCi in KS and LA Support Center's Analysis
Wednesday, October 13, 2004
LTC Comment: As Kansas tightens and Louisiana loosens their Medicaid long-term care programs, the consequences are predictable. More after the ***news.***
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*** BOSTON LONG-TERM CARE GRADUATE SEMINAR. Steve Moses will present this highly regarded class on Thursday, November 11, 2004 at the University of Phoenix, 100 Grossman Drive, Suite 201, in Braintree, Mass. Pre-registration is required. Contact Executive Director Amy McDougall at 425-377-9500 or firstname.lastname@example.org to register. Tuition is $225 for the full-day program. Check out the syllabus, rave reviews, and other details at http://www.centerltc.com/ltc_grad_seminar.htm . We call this class a "LTC graduate seminar" because it is intended for experienced and knowledgeable insurance agents, financial advisors, attorneys, and LTC providers. Instead of sitting through another dose of LTC 101, you'll be getting an advanced program available nowhere else from a leading national authority on long-term care service delivery and financing. ***
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LTC E-Alert #4-048--Can You Trust Consumer Reports About Nursing Homes? (CR was just as careless and ideologically biased in a story about nursing homes as in its LTCi coverage.)
The LTC Data Update #4-037--How to Interpret the MetLife LTC-IQ Test Results (One of the key findings in this new survey requires further interpretation.)
LTC E-Alert #4-049--ThaiCare or How to Control U.S. Health Care Costs (With a health savings account, it pays to get top quality medical care in Bangkok and a free vacation to boot.)
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LTC BULLET: MEDICAID AND LTCI IN KS AND LA CONFIRM REALIST'S GUIDE'S MODEL
LTC Comment: Below are links to and excerpts from two newspaper editorials. The first comments on recent efforts by the State of Kansas to tighten its Medicaid long-term care program by imposing liens on recipient's real property. The second article discusses Louisiana's attempts to reduce nursing home institutionalization and encourage more home and community-based services.
We bring these matters to your attention to illustrate the analytical model explained in the Center's most recent report: "The Realist's Guide to Medicaid and Long-Term Care." Read it at http://www.centerltc.org/realistsguide.pdf . According to pages 20-21 of the "Realist's Guide":
"If a state Medicaid program offers generous eligibility, highly desirable home and community-based services, and recovers little or nothing from recipients' estates, then we would expect the state to experience low market penetration for private financing alternatives like long-term care insurance and home equity conversion, and a relatively high Medicaid nursing home census.
"In other words, the more attractive Medicaid is in terms of eligibility and services, the less likely people will be to take personal responsibility for long-term care and the more likely they will be to become dependent on Medicaid.
"Conversely, if a state Medicaid program enforces stricter long-term care eligibility, offers primarily the less desirable nursing facility services, and recovers aggressively from recipients' estates, then we would expect the state to experience higher market penetration for private insurance and home equity conversion and to have a relatively lower Medicaid nursing home census.
"In other words, the less attractive Medicaid is in terms of eligibility and services, the more likely people will be to take personal responsibility for long-term care and the less likely they will become dependent on Medicaid.
"Of course, no state is a pure case. Every state has some characteristics that tend in opposite directions. For example, a state with strong estate recoveries (which discourage Medicaid dependency and encourage private financing) may also have generous home and community-based services (which encourage Medicaid dependency and discourage private financing)." ("The Realist's Guide to Medicaid and Long-Term Care, " pps. 20-21)
How does this model hold up as applied to Kansas, which is tightening Medicaid eligibility with a new lien program, and Louisiana, which is making Medicaid more attractive by offering more home and community-based care?
Kansas recovered $4.8 million from the estates of deceased Medicaid recipients in 2002, ranking it 20th in the country. Louisiana recovered nothing.
Long-term care insurance market penetration in Kansas is 10% to 14%. Louisiana's LTCi market penetration is only 1% to 5%.
Kansas has a very low Medicaid nursing home payer census of 53.9%, 49th lowest in the country. Louisiana's Medicaid nursing home census is 75.7%, 5th highest in the country.
Thus, Kansas is tough on estate recoveries and enjoys a high LTCi market penetration and a low Medicaid nursing home census.
Louisiana, on the other hand, does not report any recoveries from estates, has very low LTCi market penetration and very high Medicaid nursing home census.
Of course, other factors are also involved, but it is interesting to note the correlation between tougher Medicaid eligibility enforcement and higher LTCi market penetration and higher private pay nursing home census.
As the article about Louisiana explains below, the state plans to expand Medicaid-financed home and community-based services. That is a desirable goal, but a dangerous and expensive one to pursue, unless and until the state controls its Medicaid eligibility hemorrhage first.
Editorial, "Payback? It doesn't seem unreasonable for the state to try to recover from Medicaid recipients some of the costs of providing their medical care," The Lawrence Journal-World, September 30, 2004, http://ljworld.com/section/editorials/storypr/182934 .
"What should we expect from our government?
"In some cases, Americans' idea of what they are entitled to in the way of government services seems a little out of whack.
"A state law that takes effect Friday apparently has triggered a fair amount of concern and criticism from people who receive state Medicaid payments. The law allows the state, under some circumstances, to claim assets from Medicaid recipients or their estates to help recover some of the cost of paying for their care. . . .
"Medicaid is an important safety net for low-income Kansans, but the money to support it doesn't fall from heaven; it comes from taxes paid by hard-working Kansans with homes and medical costs of their own. Because we, as a state and a nation, think it's important to take care of those who are less fortunate, we fund Medicaid so people can receive needed medical care and, in some cases, continue to live in their own homes. It's not reasonable, however, to expect taxpayers to also provide an inheritance for a Medicaid recipient's family.
"Where did we get the idea that we're entitled to have someone take care of us, whether that means providing medical care or even preserving our inheritance? Repaying the state or any other entity that has taken care of us in a time of need just seems like the honorable thing to do. It's almost too bad it takes legislation to force people to do the right thing."
Editorial, "Long-term care reform needed, one-size fits-all approach doesn't address individual circumstances," The Shreveport Times, September 27, 2004, http://www.shreveporttimes.com/opinions/html/C155E59B-C026-4017-959F-7BA8D2628C1E.shtml .
"With the devil of a fiscal crisis at her back and a politically choppy deep blue sea in front, Gov. Kathleen Blanco is plunging into reforming the state's approach to long-term care.
"The governor correctly wants to push more long-term care dollars toward community-based options at the expense of institutional care, which is surely to create tension in the politically active nursing home industry. . . .
"And a funding crisis provides great impetus. State officials are projecting a $570 million Medicaid shortfall in the next fiscal year.
"Often because of medical needs and economies of scale, nursing homes make sense. But it's not always about saving money, but about quality of life. When medically possible, it makes more sense to keep an elderly person or someone developmentally disabled at home, in an adult day care or some other community setting. . . .
"Admittedly, in regards to long-term care in Louisiana, at-home options may not be the cheapest. The state Department of Health and Hospitals reports spending $36,128 per recipient last year for personal-care attendants in homes and community settings. A year of care in a private nursing home cost $33,625. But experts from other states say savings could be realized by providing an array of options, though converting to a new approach could harbor transitional costs. . . ."