LTC Bullet: Is Medicaid the LTC Solution or the Problem?

Friday, December 4, 2020


LTC Comment: Will more Medicaid funding and regulation help (short-term) and harm (long-term) America’s fragile long-term care system? Answers after the ***news.***

*** “LTC CLIPPINGS” is a special daily service that premium Center members ($250 per year or $21 per month) and above can opt to receive. Steve Moses scans the internet for news, articles, reports and data you need to know before your prospects start asking about them. He provides the date, title, author, a link, a representative quote and a brief, often humorous or satirical, but always thoughtful comment. Know what you need to know before you’re caught off guard. Subscribe to LTC Clippings. ***


11/28/2020, “Medicaid is hemorrhaging $100B on Americans ineligible for the program,” by Brian Blase, New York Post

Quote: “The federal government’s improper Medicaid payments now exceed $100 billion a year. This means that more than one-in-four dollars flowing out of Medicaid — our nation’s third-largest government program — do not meet program rules. This staggering failure doesn’t just reduce health-care access for the truly eligible, it also harms taxpayers who fund it.”

LTC Comment: This is an excellent piece by my co-author of “Nursing Homes, Coronavirus and Medicaid,” published June 1, 2020, in the Wall Street Journal. The problem of improper payments is even worse since the Families First Coronavirus Response Act (FFCRA), signed March 18, 2020, imposed maintenance of effort rules prohibiting states from terminating eligibility even for the ineligible. See Medicaid Maintenance of Eligibility (MOE) Requirements: Issues to Watch When They End, Kaiser Family Foundation, September 22, 2020, for details. Kind of makes tracking improper payments moot if ineligibility itself isn’t “improper.” Ugh!


11/25/2020, “COVID-19 Has Claimed the Lives of 100,000 Long-Term Care Residents and Staff,” by Priya Chidambaram, Rachel Garfield and Tricia Neuman, Kaiser Family Foundation

Quote: “This week marks a bleak milestone in the pandemic’s effect on residents and staff in long-term care facilities across the country. According to our latest analysis of state-reported data, COVID-19 has claimed the lives of more than 100,000 long-term care facility residents and staff as of the last week in November. This finding comes at a time when public health experts are predicting a surge in cases after holiday gatherings and increased time indoors due to winter weather, which will have ripple effects on hospitals and nursing homes, given the close relationship between community spread and cases in congregate care settings. As the nation braces for the fallout of the holiday, recent data on deaths in long-term care facilities highlight the ongoing disproportionate impact on this high-risk population.”

LTC Comment: Maybe the time has come for another “Long-Term Care Consciousness Tour.” Here’s what the first one was like: This is my favorite reminiscence of that 2008-9 Tour. The need for long-term care planning is even greater now than it was then.


11/20/2020, “Nearly 6 million Americans expect to lose homes in the next 2 months: survey,” by Amy Novotney, McKnight’s Senior Living

Quote: “Approximately 5.8 million Americans — including many seniors — say they are somewhat or very likely to face eviction or foreclosure in the next two months, according to a Bloomberg analysis of survey data from the U.S. Census Bureau. The survey also found that about 28% of renters, or roughly 14.9 million Americans, have little to no confidence that they’ll be able to pay their December rent.”

LTC Comment: So what’s next? Let them suffer? Or another paroxysm of government borrowing and money printing to aid home buyers and renters? And, when that public debt bill comes due, what then? ***


LTC Comment: As the Covid plague surged through long-term care facilities this spring, one thing was certain. The long-term care intelligentsia would recommend more government, specifically Medicaid, spending. Our favorite federal fetishist, Judith Feder of the McCourt School of Public Policy at Georgetown University, was no exception. In May 2020, she proposed

Long-term care financing policy should be modified to either adjust federal matching funds by the age of each state’s population, or fully federalize the funding of LTC expenses of Medicaid beneficiaries who are also eligible for Medicare. (p. 350)

That didn’t happen, won’t, and shouldn’t. Federal funding and regulation of long-term care are what caused us to rely excessively on underfinanced institutional care settings for elderly people leaving them susceptible to the pandemic’s ravages. More of what caused the problem in the first place will hurt, not help.

In fact, what the federal government actually did exacerbated the problem of excessive federal dependency. In Feder’s words …

The Families First Coronavirus Response Act included a modest 6.2 percentage point bump in the Medicaid match tied to the public health emergency, conditional on states’ retention of current eligibility levels or “maintenance of effort” (Broaddus, 2020). (p. 352)

So, the Feds gave states a little more money but only if they maintained their current Medicaid efforts. What does this “maintenance of effort” mean? According to the Kaiser Family Foundation

To receive the enhanced federal matching funds, states must meet certain MOE requirements that include ensuring continuous coverage for current enrollees. Specifically, states must provide continuous eligibility through the end of the month in which the PHE [public health emergency] ends for those enrolled as of March 18, 2020, or at any time thereafter during the PHE period, unless the person ceases to be a state resident or requests a voluntary coverage termination. Medicaid eligibility during this time must continue “regardless of any changes in circumstances or redeterminations at scheduled renewals that would otherwise result in termination.”1 (Emphasis in the original)

In case that bureaucratese confounds you, what it means is that state Medicaid programs, if they want to receive the extra federal money, can’t tighten their loose LTC financial eligibility rules. They can’t even terminate Medicaid recipients who are proven to be totally ineligible. They must throw the federal financial floodgates wide open.

So how is this generous policy working out so far? Are people in nursing homes finally free from worry and sickness? Hardly. According to the Kaiser Family Foundation

This week marks a bleak milestone in the pandemic’s effect on residents and staff in long-term care facilities across the country. According to our latest analysis of state-reported data, COVID-19 has claimed the lives of more than 100,000 long-term care facility residents and staff as of the last week in November.

The holidays and long winter months ahead presage much worse. Current public policy for long-term care services and financing is deadly. We should be asking: “How did we get into this mess?” not “How much more federal money and regulations can we pour on?”

For an answer to the first question, see Medicaid and Long-Term. That 2020 monograph explains step by step how Medicaid caused the very problems that people ask it to solve today. The study’s recommendations explain how to fix the problems Medicaid created.

For specific state-by-state analysis and recommendation, see our many state-specific reports at As you see the increasingly frequent pleas of Governors and long-term care trade groups for federal relief, visit that site, find our report for whichever state, and forward its link to them. Policy makers can reduce Medicaid costs and simultaneously expand and improve care, but they must first understand why costs are so high now and care quality so diminished.

Answers to long-term care’s persistent problems—poor access and quality, institutional bias, inadequate funding, etc.—are readily available. The knee-jerk reaction to increase Medicaid actually cripples any hope to fix these problems in the future. Yet, it’s easy to understand why politicians and provider associations gravitate toward the easy money in the current crisis. Any port in a storm.

Unfortunately, higher spending for Medicaid in the short term is far more likely than thoughtful restraint given the incoming Biden administration’s ideological predispositions. With Yellen at Treasury, pile-it-on Powell at the Fed, the Modern Monetary Theory predominating, and fulsome support for unlimited federal spending guaranteed from academia and the media, greater damage to long-term care services and financing is probably inescapable.

It’s as though a family had their maxed-out credit card limit miraculously doubled all of a sudden. The good times would roll until they hit the higher limit too. What’s the upper limit for federal spending? I don’t know, but I’m afraid we’re going to find out.