Robert MollicaNational Academy for State Health Policy

And

Leslie HendricksonHendrickson Development

November 12, 2009

Goal 3: Financing StudyExamine laws, regulations, policies and payment

methodologies affecting long-term care in CaliforniaIdentify barriers and make recommendations to:

Improve access to home and community based servicesMore effectively manage funding for services that promote

community living optionsReport addresses older adults, adults with physical

disabilities and persons with developmental disabilitiesDoes not address persons with mental illness

FocusMedi-Cal services

IHSS HCBS waiver programs (MSSP, ALW, NF/AH, AIDS)Nursing Facility servicesADHC

Did not includeState general revenue programsOlder Americans Act

Challenges to Managing Long Term Care

Fiscal, geographicServices covered by multiple state and county agencies

Department of Social ServicesDepartment of Health Care ServicesDepartment of AgingDepartment of Public HealthDepartment of Developmental Services

General lack of streamlined accessNo common database across programs

Balancing: What Is It? No standard definition of balanceSystem enables consumers to choose services and settings

based on their preferencesDefined by state policyPossible measures

Percent of spending on HCBSPercent of people served in community settingsMonths in the community vs institutional settingsPercent of new users who receive HCBS

Comparing StatesCMS 64 expenditure data released annually by Thomson

ReutersUnder-reports HCBS spending in some states

Expenditures not included in rankingsState plan Adult Day Health CareTargeted Case ManagementState general revenue services

Defining “Institution” and Community Settings

Key Findings: RankingsParticipant rankings:

1st in number of personal care participants/1,00042nd in HCBS waiver participants/1,0006th in total HCBS participants/1,000

Per capita spending (all populations)Personal care 4th

Total HCBS 18thHCBS waivers 48th

Nursing facility 41st

ICF-MR 33rd

Percentage HCBS Spending

Population CA NAT AVE

Percent HCBS (all populations) 54% 42%

Older adults, individuals with 52% 31%physical disabilities

Individuals with developmental 62% 63%disabilities

Key Findings…Programs spread across multiple agenciesOnly DDS has a single entry point systemNo agency-wide long-term care strategic planInstitutional bias in financial eligibility for nursing facility

and HCBS waiver servicesLimited organizational base to build or expand new

programs (eg statewide transition program)

Key Findings…Progress relocating individuals from Developmental

CentersNursing home supply and Medi-Cal use declined from

2001 to 2008California National

Supply - 6.0% -1.6%Medi-Cal census -.4% - 8.3%

Nursing facility rate does not control for low occupancyRates exceeded inflation

Cost effectiveness/woodwork effectChange the service mix to meet expanding need

Reduce the spending growth rateSet aside waiver slots for persons relocating from

institutionsConduct a “break even” analysis“Cost avoidance” through diversion

Use of the ReportContinue status quoFormulate a transition planIncremental changesBroader changes

Recommendations: 28Time to implement

General Short-term (12 months) Medium-term (12 – 24 months)Longer-term (24 months or longer)

CategoryFinancingAccess/delivery systemState-level organization

General Recommendations Establish a philosophy and legislative intent for all long-

term services and supportsCurrently only described for specific programsNo overall statement of intent for the “system”

Develop a strategic plan for long-term services and supportsPopulations addressedTimetables, responsibilities and measureable goals

Budget FlexibilityCreate a unified long-term care budget for aged/disabled

servicesNursing facility servicesIn Home Supportive ServicesMultipurpose Senior Services ProgramOther HCBS waivers

Reinvest Savings in HCBSWaiver programs are cost effective and should be

expanded Transfer savings to HCBS programs from individuals who

transition from nursing facilitiesAllow appropriations for nursing facilities to pay for

HCBS for waivers with waiting lists

Rental Assistance VoucherAddresses need for affordable housing for individuals

who want to transition from an institutionConvert a portion of the state share of savings in a nursing

home to a temporary rental assistance subsidyIndividuals must be on a waiting list for a housing choice

voucher

Nursing Facility ReimbursementAdopt nursing facility case mix reimbursement system for

the staffing component of reimbursement rateCreates incentives to serve higher acuity residents and

divert lower acuity applicants to community programsReimbursement level for property costs seems too lowExamine reimbursement level for insurance which might

need cap on size of per diem costs

Reduce Payments for Vacant Nursing Facility Beds

Establish a nursing facility occupancy provisionBased on a flat percentage of licensed beds or the

statewide average occupancy rateGAO report on 19 states found the average nursing

facility occupancy provision used by other states was 88.6%

25% of CA nursing facilities have occupancy rates below 85%

Convert “labor driven operating allocation”

Now used as incentive or bonus for hiring staff instead of contracting for staff

Some or all of labor offset can be converted to support other policies:Incentivize homes to support transition effortsPromote “Culture Change”Pay for Performance for meeting quality of care and quality

of life goals, e.g. example of ColoradoRestructure physical plants, build residential optionsPromote more staff training

Managed Long-Term Care ASPE report – “most studies and officials report that

managed LTC reduces use of institutional services and increase use of HCBS relative to fee for service programs”

Consumer satisfaction is highImproves coordination of health and long term care needsReduce hospital use, emergency room visits, lower overall

costs

Increase Scope of Provider Fees

Add Medicare revenue to Quality Assurance Fee Added after study was completed

Identify provider groups interested in establishing QAFs for HCBS

Streamline Access to HCBSCreate single entry points for older adults and adults with

physical disabilitiesScope of programs and activitiesPossible entities

Regional or County based organizationsADRCMSSP sitesArea Agencies on Aging

Co-locate financial eligibility workers in SEPs/ADRCs

DiversionWork with hospitals to provide preadmission

screening/options counseling for individuals who:Seek admission to a nursing homeDischarged from a hospital with health & supportive service

needsProvided by single entry points, ADRCs, community

organizationsPriority groups

Medi-Cal beneficiariesLikely spend down within 3 or 6 months

Transition ProgramEstablish a statewide nursing facility case management

function to support residents who can relocate to the community

Support and expand Money Follows the Person project Provide funds to help Independent Living Centers, MSSP

sites, Area Agencies on Aging, other non-profits and counties to expand transition programs

Takes several years to build an effective infrastructure

Eligibility Changes to Increase HCBS Use

Addresses institutional biasAdd the 300% of SSI eligibility group to HCBS waivers

Allows people who would spend down in a nursing home to be eligible for HCBS waivers in the community

Establish maintenance allowance/share of cost

Help Individuals in Nursing Facilities Keep a Home

Increase the home maintenance allowanceAllows individuals admitted to a nursing home to retain

income to maintain their homeMust expect to return home within 180 daysCurrent allowance is $209 a monthOptions: Exempt up to 100% FPL; Percentage of the

SSI/SSP payment; Total SSI/SSP payment

Keep a Home…Maintain the SSI/SSP eligibility status for short-term

nursing home admissionsAllows individuals in a nursing home for less than 90 days

to receive their full SSI/SSP payment to maintain their home

Services in Residential SettingsOffers options for people who need access to services for

unscheduled needs, oversight and supervisionProgram options

Allow IHSS payments in RCFEsExpand assisted living waiver statewideAdd assisted living services to MSSP, NF/AH waiver

Expedite Financial EligibilityAllow case managers to presume financial eligibility and

enroll applicants in an HCBS waiver to avoid nursing facility admission

“Fast track” the eligibility processCo-locate financial eligibility workers with single entry

points/ADRCs

New Department Create a Department of Long-Term Services and SupportsLittle Hoover Commission recommendationPossible components

In Home Supportive ServicesMultipurpose Senior Services ProgramAssisted Living Waiver ProgramOther HCBS waiversNursing home level of careNursing home licensingRCFE licensing