and is able to leave the isolation of the home, the added socialization activities available in a medical day care center can enhance the client's quality of life.

A comparison of the cost of medical day care in New Jersey which averages $31 a day versus home health care which could be $9 to $30 an hour in New Jersey demonstrates the cost effectiveness of this medical day care service.

In summary, we in New Jersey applaud the efforts of your committee to publicize the value of adult day health care. Our experience has shown that this service is an essential community based option which meets the needs of many New Jersey residents whose medical and social needs would go unserved or who would otherwise be forced to enter an institution.

Thank you.

[The prepared statement of Ms. Kurland follows:]

TESTIMONY OF CAROL H. KURLAND

ADMINISTRATOR, OFFICE OF HOME CARE PROGRAMS

NEW JERSEY DEPARTMENT OF HUMAN SERVICES

DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES

Mr. Chairman and Members of the Committee:

I am Carol H. Kurland, Administrator of the Office of Home Care Programs in the New Jersey Department of Human Services, Division of Medical Assistance and Health Services. My office is responsible for several home and community-based services programs reimbursed by Medicaid, among which is our statewide Medical Day Care Program. I have been involved in adult day care for over ten years and served on the National Council on Aging's National Institute of Adult Daycare and its committee which developed the adult day care standards in 1984.

Our Department appreciates the opportunity to provide testimony in support of adult day health services and to share our experiences in implementing a Title XIX-funded program in New Jersey. We want to commend the chairman and committee for scheduling these important hearings.

New Jersey has been a proponent of adult day health care or medical day care, as it is known in our state, for many years. Medical day care was introduced as a statewide Medicaid service in May 1977, as a health care alternative to total institutionalization.

New Jersey became the fifth

state in the nation to use Medicaid dollars for adult day care. In recent years medical day care has become a popular Medicaid service nationwide particularly within the Section 2176 Medicaid waivers. New Jersey has five waivers that provide medical day care as a vital service to our elderly and disabled within the continuum of long term care.

In 1977 New Jersey Medicaid was searching for a non-institutional health care option. The waiting lists for nursing homes were growing rapidly. A study commissioned by the state and carried out by the Urban Health Institute of New Jersey in September, 1977 revealed that 35% of those patients institutionalized at the Intermediate Care Facility B Level (ICFB) could have been discharged if appropriate services and settings were available.

New Jersey's Medical Day Care Program was modelled after an Informational Memorandum issued by the (then) U.S. Department of Health,

Education, and Welfare in January, 1976, relating to "Reimbursement under Title XIX, Social Security Act for Services to the Chronically Ill and Impaired in Alternative Settings." These Federal guidelines remain the only ones issued on this service area.

New Jersey decided to target the Medicaid eligible population to be served in medical day care as the chronically ill elderly or other disabled adults who:

were at the point of discharge from hospital or other acute care facility.

were residing in the community and "in crisis"

were residents of nursing homes but inappropriately placed.

Initially, only long term care facilities were permitted by New Jersey Medicaid to become medical day care providers because of our uncertainty about how large the program would become. However, we realized that sufficient system controls existed to allow for a gradual expansion of these services. In 1980 freestanding "independent clinic" type programs were approved and in 1982 hospital-affiliated centers were accepted as medical day care providers.

To be approved as a New Jersey Medicaid provider of medical day care services, specific requirements must be met. They are:

2. Approval by the Medicaid Division as to conformance with program standards of staff/services/documentation. A Center must be a separate identifiable program, with a distinct staff, operating five days a week/seven hours a day. Centers must provide eight basic services; medical, nursing, social services, transportation, personal care, dietary, social activities, and rehabilitative services.

Staff must include a full-time Program Director, part-time Medical Director, full-time nurse, social worker, activities coordinator in a ratio of nine participants to one staff. Therapies must be available on the premises or under contract to the center.

The primary concern of both the State Department of Health and the State Medicaid office is the need for medical day care to be healthdirected. This means that services provided and the persons served must conform to a medical model.

Each person entering a medical day care center is certified by an attending physician as needing this care. An individualized plan of care prepared by the medical day care staff requires a physician's certification through a physical examination performed initially, and every 90 days.

The

plan of care, which has multidisciplinary input, is submitted to a Medicaid District Office for review and authorization by a Medical Evaluation Team, prior to the provision of services by the Center.

A Medicaid Medical Review Team, comprised of a physician, nurse, social worker and pharmacist, also visits each center several times during the year to evaluate the program.

Against this background of a health care service, developed to meet an identified need for community-based care, medical day care in New Jersey has slowly grown over the past eleven years to a very visible needed option. Currently, there are 48 centers in the state; 23 nursing home-based, 18 freestanding and 7 affiliated with hospitals, serving an average of 800 participants a month, at the cost of $3.6 million in FY 1987. Centers may voluntarily target the elderly, Alzheimer's population, young adults with cerebral palsy, a population in need of rehabilitation. Centers are located in almost every county, in urban and rural areas, providing a uniform standardized program of services. They universally provide a therapeutic program of services geared to either improve or maintain an optional level of functioning.

A specialized program for AIDS and ARC patients, recently opened under the auspices of a drug treatment center, is the newest freestanding program. The services provided through this medical day care center will be covered as a regular Medicaid service and also under our specialized AIDS Home Care Waiver.

Since medical day care began as a nursing home based program, the reimbursement was related to the cost of nursing home care. Currently, Medicaid pays 55% of the Intermediate Care Facility B (ICFB) rate which averages $31 per diem. In New Jersey the annual net cost of an ICFB (nursing home) patient is $14,664. Since medical day care services are provided on an average of two-three days a week, a participant who resides in the community with comparable needs to an ICFB patient costs Medicaid approximately $4800 per year, a considerable saving to our program.

Data was recently compiled on 1083 Medicaid clients in 38 centers. Centers were found to range in size from 6 to 109 participants, with a median census of 33 and a mean daily attendance of 24.5 per center.

Sixty percent of the individuals served were 65 or older, 18.6 percent were 55-64, and 21.4 percent under 55. Ages actually ranged from 20-101. Most participants were female (75%). Racial characteristics were 44.4 percent black, 43.6 percent white, 11.3 percent Hispanic. Over 88 percent were not married. Of these, 41.3 percent were widowed, 31 percent never married.

Most individuals lived alone (34%), with adult children or parents (28%) or in a boarding home situation (14%). Over 33% had no primary caregiver. For 20 percent the adult child was the primary caregiver.

The most common significant diagnoses were cardiovascular disease and musculoskeletal disorders. There were also significant numbers of clients with diabetes, eye disorders, mental illness and retardation, miscellaneous neurosensory, nutritional and metabolic disorders, and Alzheimer's Disease, diagnoses not dissimilar to those found in nursing home patients.

Individuals attended the program because of their chronic physical health problems, social isolation, recent deterioration of medical status, increased dependency, and their caregivers' need for relief.

The overwhelming majority (93%) lived in the community and were considered "at risk." Participants required health monitoring, therapeutic recreation and nutrition, social services, supervision/administration of medication. Few required physical, speech or occupational therapy.

It is my understanding that you are interested in hearing about specific cases served in medical day care. Four actual cases illustrate the value of this service.

1. Florence, a 78-year old widow, currently living with a Stepdaughter, neglected her own health while caring for her chronically ill husband. The staff at the center observed hematuria (blood in her urine). She was hospitalized and diagnosed as having cancer of the bladder. She has returned to the center and the staff coordinates her radiation therapy program and observes for side effects to the treatment. Without the medical day care participation, institutionalization may have been the only option.