Long-Term Care - Always the Bridesmaid, Never the Bride

Although millions of Americans rely on long-term care services to meet their health and personal assistance needs, the topic of how quality long-term care services should be provided and financed rarely reaches the top of the policy agenda. The incentives for institutional care, lack of standard quality indicators, lack of care coordination, high out-of-pocket costs incurred by users, and fragmentation of long-term care financing are persistent problems. Despite these well-documented issues and the large segment of the population receiving, providing, or paying for long-term care services, long-term care is overshadowed in the national policy arena by other issues affecting similar populations, such as prescription drug coverage.

The United States health care system was built around the provision of acute care. This implicit focus has not changed even as the number of people using long-term care services grows. The majority of individuals using long-term care services in the United States are 65 and older, and this proportion inevitably will grow as the population ages: in 2000, there were 34.9 million adults over the age of 65 (13 percent of the population)(1); this group is predicted to reach 53.7 million (16.5 percent of the population) by 2020. (2)The aging of the U.S. population and the projected growth of the older age brackets will have a major effect on the demand for and supply of long-term care services and on the resources needed to provide those services.(3) Given the challenges facing long-term care and the imminent aging of the population, policymakers have an opportunity to improve the financing and provision of quality long-term care.

Long-term care is not at the forefront of national policy debates, although it frequently has been found at the periphery of many policy discussions. In 1999, for example, the National Bipartisan Commission on the Future of Medicare identified long-term care as one of the gaps in the Medicare benefit package.(4) The Commission's final recommendations suggest that further research be done to estimate future demand for long-term care services and to analyze potential policy options.(5) The other weaknesses identified by the Commission, prescription drug coverage and catastrophic coverage, are currently being addressed and debated in bills on the floors of Congress. There is little indication, however, that long-term care will be next on the agenda.

There have been periods in which long-term care has been a more prominent part of the national policy agenda. In the early 1990s, the deliberate efforts of consumer advocates, the Clinton administration's efforts to enact acute-care reform, and the comprehensive nature of the Clinton reform initiative led to a greater policy focus on long-term care.(6) For example, long-term care was an integral part of the Clinton health plan, which was introduced as the Health Security Act in September 1993. The long-term care portion of the plan had as its centerpiece funding for states to provide home- and community-based long-term care services to people with severe disabilities, regardless of age or financial status. The Act, for a number of well-documented reasons, never passed.(7) Since then, long-term care has fallen off the policy agenda at the national level.

At the same time, long-term care has been climbing the states' policy agendas primarily because states are the largest public payer of long-term care services. In recent years, Medicaid paid for almost 45 percent of the total cost of care for persons using nursing facility or home health services.(8) As the number of people using these facilities continues to increase, and states' well-documented fiscal crises worsen(9), states are considering Medicaid cuts that threaten the sustainability of long-term care services to those individuals who need them. For example, in February 2003, Oregon cut nearly 4,800 clients (14 percent of the long-term care caseload) from eligibility for
its Medicaid Home and Community-Based Care Waiver.(10)

As states continue to grapple with their role in long-term care and as it becomes a higher priority for national policymakers, a core of evidence is needed to inform the policy decisions. AcademyHealth, the national program office of HCFO, recently released three issue briefs detailing how research has improved long-term care service delivery and policy in the past, and how it might continue to do so in the future.

• Long-Term Care: Collaborating for Solutions profiles successful collaborations between providers, policymakers, and researchers to improve service delivery, policymaking, and research related to long-term care, and discusses their benefits and challenges.
• Long-Term Care: Informed by Research highlights areas in which publicly and privately funded research has informed long-term care service delivery and policy.
• Long-Term Care: Confronting Today's Challenges identifies challenges for long-term care policy and service delivery (e.g., workforce shortages, integration of care), which can be ameliorated, in part, by information provided by health services research.

On June 18, AcademyHealth also held a press briefing on this issue. The briefing featured a recently published paper (11) by Penny Feldman and Robert Kane and a soon to be published paper (12) by Peter Kemper, also making the case for building evidence in long-term care. A web cast of the event is available.

In addition to these AcademyHealth activities, HCFO has sponsored research that can help policymakers think through what the future of long-term care might hold and what policy options would be most effective in improving the quality and financing of care in this area. See below for a list of HCFO-funded grants relevant to long-term care.

HCFO-Funded Projects Relevant to Long-Term Care

Title: Assessing the Impact of Medicaid Equalization Policies on Access to Nursing Home Care
Institution: Syracuse University
Principal Investigator: Madonna Harrington Meyer, Ph.D.
Time: January 01, 2002-July 31, 2003

Researchers at Syracuse University are assessing the impact of Medicaid equalization policies for nursing home admissions on older persons and their families, the nursing home industry, and state Medicaid programs. The researchers set forth three objectives: 1) identify which states have passed provisions that limit the discrepancy between private and Medicaid rates; 2) assess the impact of that legislation on nursing home profits, closures, waiting lists, occupancy rates, and state Medicaid budgets; and 3) trace the passage of each state-specific policy to assess the feasibility of developing a model for a national Medicaid equalization law. The objective of the study is to inform policymakers about the implications of revising the Medicaid and long-term care systems through a national Medicaid equalization policy.

Title: The Impact of the Prospective Payment System on Nursing Home Care
Institution: Brown University
Principal Investigator: David Gifford, M.D.
Time: June 01, 2000-May 31, 2002

The SNF PPS created a fixed, all-inclusive, per diem reimbursement rate per patient, based on where that patient fits within a resource utilization group (RUGs) classification system. For some high-need RUGs, the cost of care may be higher than the per diem rate set by the SNF PPS due to increased pharmaceutical use, the costs of which may not have been fully assessed when calculating the per diem. Researchers at Brown University hypothesized that instituting a prospective payment system may give SNFs the incentive to block access to care for patients who fall into more severe RUGs classifications, potentially reducing care options and increasing the risk of negative outcomes for frail elderly. The researchers: 1) examined the effect of the SNF PPS on patient-level indicators, including access to SNFs, utilization of costly care (including pharmaceutical therapies whose costs go above the per diem cap) and re-hospitalization during high acuity episodes; and 2) examined the effect of the SNF PPS on facility-level indicators, such as case-mix, changes in SNF staffing, and bed availability. The objective of this project was to inform policymakers about the implications of prospective payment cost-reduction strategies on access to and quality of care through skilled nursing facilities.

For a summary of the findings of this grant, refer to "New Payment System Has Little Effect on Access and Quality."

Title: Alternative Models for Ensuring Access to Primary Medical Care in Nursing Facilities
Institution: State of New York, Department of Health; Health Research, Inc.
Principal Investigator: Suzanne Moore, Ph.D.
Time: July 01, 1992-December 31, 1995

This project conducted by the New York State Department of Health demonstrated four models for providing primary care in nursing facilities: 1) non-staff physicians in the community provide care on a fee-for-service basis when requested by the facility's nursing staff (the traditional model); 2) a staff physician provides primary care services to all residents; 3) staff nurse practitioners work collaboratively with the facility's medical director; and 4) staff physician assistants work collaboratively with a staff physician. The researchers compared the quality of care, health outcomes, and costs associated with each model to determine which are most cost-effective.

Title: Long-Term Care Options Planning Project
Institution: State of Minnesota, Department of Human Services
Principal Investigator: Pamela J. Parker
Time: July 01, 1994-June 30, 1995

The Minnesota Department of Human Services finished work on a planning grant to design a Medicaid and Medicare financing and delivery demonstration integrating acute and long-term care services under a capitated managed care framework. The state submitted a waiver application to HCFA (now CMS) requesting permission to implement the LTCOP. This interim grant permitted the state to continue development of the LTCOP, while awaiting a final decision from HCFA regarding the implementation of the LTCOP. The objective of the LTCOP was to determine whether it is possible to build partnerships among acute and long-term care providers to provide services to the dually eligible elderly more efficiently.

Title: CCRCs: An Efficient Alternative for Long-Term Care Provision and Financing?
Institution: Duke University
Principal Investigator: Frank A. Sloan, Ph.D.
Time: January 01, 1992-December 31, 1994

This study examined who enters CCRCs and why, which factors influence nursing home utilization in CCRCs, and financial stability of CCRCs by conducting a survey of CCRC residents and analyzing data from the 1989 National Long-Term Care Survey and the American Association of Homes for the Aging survey of CCRCs. Investigators also gathered primary data from selected states to evaluate CCRC financial solvency. Finally, by studying specific regulations, they assessed the potential of CCRCs as mechanisms for providing and financing long-term care for the low-and moderate-income elderly.

Title: Evaluation of the Impact of the Resource Utilization Groups II System on Long-Term Care Facilities in New York
Institution: Greater New York Hospital Foundation, Inc. (GNYHF)
Principal Investigator: Barry M. Schultz, M.D.
Time: January 01, 1992-December 31, 1993

What is the impact of New York state's nursing home payment system using Resource Utilization Groups II (RUGS II) on access to long-term care services for Medicaid beneficiaries? What is its impact on changes in case-mix, financial status, and management practices of nursing homes in the state? This study, conducted by the Greater New York Hospital Foundation, Inc., used various quantitative analyses of nursing home cost reports and resident characteristic data, and interviews with key management staff and trustees to examine the period 1985 - 1990. The objective of the study was to provide policymakers with an assessment of this payment system's long-term impacts and to judge its replicability for Medicaid and/or Medicare beneficiaries in other states.

Title: Evaluation of New York City Model to Provide Home Care Services: The Cluster Care Demonstration
Institution: Harvard University, School of Public Health
Principal Investigator: Penny H. Feldman, Ph.D.
Time: November 01, 1990-July 31, 1993

Cluster care-where a team of workers provide home care services to a population clustered in a small geographic area-was evaluated as an alternative to traditional one-on-one home care services in New York City housing projects to inform city health officials of costs/benefits of reorganizing home health and social services. The evaluation documented the implementation of and assessed costs and outcomes associated with: 1) consolidating services at elderly housing sites; 2) deploying teams of home attendants and on-site supervisors rather than individual workers; 3) restructuring home attendant jobs; 4) adapting administrative systems to a new delivery model; and 5) helping clients gain access to a broader array of community services.

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1 Population Estimates Program, Population Division, U.S. Census Bureau, "Resident Population Estimates of the United States by Age and Sex: April 1, 1990 to July 1, 1999, with Short-Term Projection to November 1, 2000," January 2, 2001.

2 Population Estimates Program, Population Division, U.S. Census Bureau, "Projections of the Total Resident Population by 5-Year Age Groups, and Sex with Special Age Categories: Middle Series, 2016 to 2020," January 13, 2000 .

3 Institute of Medicine. Improving Quality of Long-Term Care. 2000.

4 National Bipartisan Commission on the Future of Medicare. "Summary of Reform Task Force Meetings," October 5, 1998.

5 National Bipartisan Commission on the Future of Medicare. "Building a Better Medicare for Today and Tomorrow." March 16, 1999.

6 Wiener, J, et al. "What happened to Long-Term Care in the Health Reform Debate of 1993-1994? Lessons for the Future." The Milbank Quarterly, 2001, Vol. 79, No.2, pp. 207-252.

7 Ibid.

8 Centers for Medicare and Medicaid Services. "Medicaid: A Brief Summary," July 30, 2002.

9 State Coverage Initiatives. State of the States: Bridging the Health Coverage Gap, January 2003.

10 Oregon Department of Human Services. "State tells seniors to prepare to lose services beginning February 1." January 16, 2003.

11 Feldman, P.K. and R.L. Kane. "Strengthening Research to Improve the Practice and Management of Long-Term Care," Milbank Quarterly, June 2003, Vol. 81, No. 2, pp. 179-220.

12 Kemper, P. "Long-Term Care Research and Policy," The Gerontologist, August 2003, forthcoming.