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for those who are able to leave their homes, day care services (for disabled adults and children).
In recognition of the immense burdens experienced by family caregivers, the Commission recommends that the program cover respite services to provide them with some temporary relief. Such relief would allow family members to take a much needed vacation, to meet unplanned obligations, or just to have a little time to themselves. Some caregivers desire in-home respite periodically; others prefer to place the disabled person in a nursing home for a brief period. Respite benefits, therefore, should be flexible and available in all settings. In addition, the Commission recommends that the program cover training of family members in how to deliver home-based care more effectively and support counseling for family caregivers.
Finally, the Commission recommends that skilled nursing care as well as physical, occupational, speech, and other appropriate therapy services be covered. Providing these benefits would not replace the current Medicare home health benefit; rather it would extend skilled services to persons not now eligible for Medicare.
MARILU HALAMANDARIS/NATIONAL ASSOCIATION FOR HOME CARE
Cost Sharing—The Commission believes that individuals who can contribute to the cost of their care should be expected to do so. The Commission recommends that beneficiaries be required to contribute 20 cent of the actual costs of care or 20 percent of the national average cost of home and community-based care, whichever is lower, with federal subsidization for the poor and near-poor. Since copayment would place a heavy burden on low-income individuals, the federal government would fully subsidize these costs for persons with incomes at or below the poverty level and partially subsidize them at least for those with incomes between 100 percent and 200 percent of poverty.
Commission recommendations ensure home care for the severely disabled to sustain their independence and support family caregivers.
Managing and Allocating Care-The Commission is concerned that home care services support but not replace family caregiving and be managed in a fiscally responsible manner. The Commission recommends reliance on case managers to develop and oversee individual care plans. Case management is an effective way to allocate the appropriate types and amount of services, to help individuals navigate an often uncoordinated and unwieldy system, and to manage and monitor the care process. A comprehensive case management system addresses three major problems in financing and delivering long-term care-quality, access, and costs—and can be particularly useful for a population with multiple problems that cut across traditional service delivery systems.
In requiring case management, the intent of the Commission is to build on the experience that some states already have and to preserve the flexibility and creativity that exists. The Commission recognizes that case management can be designed in a number of ways.5 Case management can be located in free-standing organizations not responsible for the service provision, or as part of a service-providing organization. 6 Some argue that case managers must remain independent of direct service delivery in order to avoid conflicts of interest and to choose the optimum service package without constraints. Advocates of the service provider approach, by contrast, suggest that those closest to the clients have the best perspective from which to make care planning decisions; that a case management/provider combination reduces administrative costs; and that this arrangement may facilitate better access to services.
The Commission does not prescribe a specific approach but recognizes that if case managers are to be located in provider agencies, safeguards must be built in to ensure the independence of the case manager in arranging and monitoring the plan of care. Audit by the assessment agency, described below, could provide that safeguard.
The case manager would then assume the responsibility for assessing the needs of the individual and tailoring a home and community-based care plan.
To ensure adequate performance, the Commission recommends that the assessment agency periodically audit the case managers. Audits may address the purposes for which the dollars are spent, the appropriate ness of service allocation, implementation of the care plans, and whether reassessments are done in a timely fashion.
To ensure fiscal responsibility in the proposed public program, the Commission recommends that the case manager operate within a budget set by the federal government. The budget established under this program, in conjunction with other available services, should be sufficient to provide all services needed by the individual. To achieve this objective, per capita amounts would be set appropriate to the service needs of individuals at different disability levels (perhaps two or three levels). The Commission recommends that the per capita amount for the most severely disabled level be set at a maximum volume of service or as a share of nursing home costs.? Amounts below the maximum would be set for lower levels of disability. The total case management budget would then be the product of per capita amounts appropriate to the disabilities of a case manager's enrolled population, adjusted to reflect area costs and the number of enrollees.
Nursing Home Care-The Commission considers financing home and community-based care a top priority. At the same time, it acknowledges that not all persons enter a nursing home to die; many return home after relatively short stays and need resources to maintain their standard of living. Many more may be able to afford to return home if their financial resources are not consumed by the nursing home stay. The Commission's recommendations, therefore, extend social insurance to cover short nursing home stays.
Working within this budget, the case manager would develop a care plan tailored to the needs of the individual beneficiary. Where care is already being provided by family and friends, the intent is to supplement and reinforce rather than to replace this informal caregiving. States with experience in providing in-home services have built the formal plan of care around the core supports provided by families and friends, and have worked cooperatively with families in building the plan. The Commission recommends that the case manager be free to allocate services to a client as needed within the budget. Expenditures for an individual's care, however, should not exceed the costs of care were the individual in a nursing home.
The Commission recognizes that comprehensive social insurance for longer nursing home stays would allocate substantial public dollars to protect the estates of the wealthiest segment of the population. Given limited resources and the potential for these individuals to purchase private insurance, the Commission chose another approach. To protect moderate- and low-income individuals against the catastrophic costs of nursing home care, the recommendations include a government-provided floor of asset protection to eliminate the risk of impoverishment and leave most people's life savings intact.
In addition to care planning and service allocation, the case manager would be responsible for monitoring implementation of the care plan and conducting periodic reassessments to determine whether changes in the amount or type of services (including the need for nursing home placement) are warranted. While the Commission does not recommend a specific schedule, it notes that most programs undertake a formal reassessment with a home visit every six months, at least during the first year. 8
The Commission recommends that those determined eligible for nursing home care by the federally certified assessment agency be entitled to coverage for the first three months of institutional care, with each three-month period of coverage considered an episode of care. Benefits would include custodial care as well as skilled nursing services for persons not receiving those services from Medicare. The Commission does not recommend a specific lifetime limit on the number of episodes to be covered. But it considers a maximum eligibility for two or three episodes to be plausible, each interrupted by a reasonable period of time (perhaps six months) to ensure that the program does not become a revolving door.
For severely disabled nursing home residents returning home, the case manager would also facilitate the transition back into the community. Before the resident's discharge, the nursing home would be required to give reasonable notice to a case manager.
As with social insurance coverage for home and community-based care, front-end nursing home coverage would not be free. The Commission recommends that all individuals be required to contribute 20 percent five current elderly individuals would be immediately eligible for benefits at these asset levels. Over time, the Commission expects that eligibility levels would be adjusted to sustain that scope of protection.
These recommended levels would be a vast improvement over current Medicaid rules, which require single persons to spend down their non-housing assets to $2,000. The Medicare Catastrophic Coverage Act of 1988, in a provision still in effect, did improve the asset protection for noninstitutionalized spouses, setting a minimum resource allowance at $12,000, and allowing spouses to keep half of assets up to $60,000.9 The recommended program, however, would set the floor for spousal assets at $60,000. Individuals with non-housing assets in excess of the levels protected by the program would be required to liquidate these resources and use them to finance their nursing home care before becoming eligible for program benefits. A case example of how this program would affect one individual appears on the next page.
The Commission recommends that individuals with long nursing home stays be required to contribute income toward the costs of this nursing home care, after certain portions of income are protected.
Under the Commission plan, people needing nursing home care would be protected no matter how long they stayed. of the actual costs of care, or 20 percent of the national average cost of nursing home care, whichever is lower, with federal subsidization for the poor and near-poor. The federal government would fully subsidize this copayment for individuals with incomes at or below the federal poverty level, and partially subsidize it at least for those with incomes between 100 percent and 200 percent of poverty.
The program would allow single individuals to keep 30 percent of their monthly income for the first year of their nursing home stay so that they can maintain their homes in the community. Married persons would be eligible for this housing allowance as long as the community spouse were alive. This allowance is designed primarily for people who are likely to return to the community and have housing costs that must continue to be metsuch as mortgage payments, property taxes, rent and condominium fees, and home repairs-during their nursing home stay. The program would also provide a personal needs allowance of $100 per month to the person in the nursing home, which is a vast improvement over the typical $30 per month currently available under Medicaid.
Finally, the program would improve the spousal income protection provided by the Medicare Catastrophic Coverage Act. Under current law, states are required to set aside a sufficient amount of the institutionalized spouse's income to raise the community spouse's income to 122 percent of the federal poverty level for a couple; up to 133 percent of this level as of July 1, 1991; and up to 150 percent of this level as of July 1, 1992. The Commission recommends raising the minimum spousal income protection to 200 percent of the poverty level for a couple. In 1990, this would protect $16,900 for the spouse. Any remaining income would go toward the cost of the nursing home care.
Single individuals would be allowed to keep $30,000 and couples $60,000 in non-housing assets. Three out of
Financing of the Public Plan
Financing Long Nursing Home
The recommended social insurance for home and community-based care and the first three months of nursing home care would provide the same protection for the long-term care needs of individuals, regardless of income, that Medicare provides for health care needs. The Commission believes that the federal role for the financing of Medicare is also appropriate for the proposed program and, therefore, recommends that the federal government be financially responsible for the social insurance components of the public plan.
Sally Dowd is 78 years old and needs nursing home care. She has life savings of $30,000 and some equity in her house, which she owns. Her income, from social security and her own and her late husband's pensions, totals $1,800 a month. The nursing home into which she is moving costs $24,000 a year, or $2,000 a month.
The federal and state governments would share the financial responsibility for the part of the program that covers longer nursing home stays. However, to protect states from the sizable costs of expanding their current programs, at the outset states would be required to contribute only the amounts they now spend on Medicaid for long-term care. The federal government would bear the costs of expanded eligibility, services, and payment rates. The states and the federal government would jointly finance annual increases in expenditures similar to the way they share financing under Medicaid. Matching rates could be adjusted to reflect the long-term care needs of a state-as indicated by the size of the state's elderly population.
Current law. Ms. Dowd would be required to "spend down” $28,000 of her assets-14 months' worth of nursing home care-before Medicaid would help pay the cost of her care. She could then retain a $30 a month personal needs allowance (PNA), and would have to contribute $1,770 per month toward the cost of her care. Medicaid would pay the $230 per month balance.
Administering the Public Plan
To promote flexibility to meet the needs of a heterogeneous population, while ensuring equity across states, the Commission recommends that the federal government contract with the states to administer the public plan. The federal government would be responsible for setting guidelines and adequate standards for this administration.
Commission plan. For the first three months of her stay, Ms. Dowd would receive benefits without regard to her income or assets. She would be responsible for coinsurance of $400 a month—20 percent of the cost of the care. If she stays beyond three months, she would contribute more. But her life savings and some of her income would be protected. For one year, she could retain $100 a month for a PNA, and $540 a month (30 percent of her income) to help maintain her home. The remaining $1,160 of her income would go toward the cost of care. If she stayed beyond this period, she would retain only the $100 PNA, with $1,700 per month going toward the cost of care.
As noted above, the federal government would certify the assessment agencies and develop standardized assessment criteria for determining eligibility for home and community-based care and nursing home care under the public plan. In addition, the federal government would establish guidelines for certifying case managers to ensure adequate training and the capacity to undertake the assessment, service allocation, and monitoring functions, and for quality assurance.
Her life savings would never be affected by her participation in the program.
As described previously, the federal government would be responsible for determining the case manager budgets. Provider payment rates for both home and community-based care and nursing home care would also be determined at the federal level. Federal rate determination is intended to ensure payment adequate for access to quality care, efficiently provided, in all parts of the country. For nursing home care, many
states have extensive experience with prospective payment systems, some of which include sophisticated design to reflect resident characteristics and to foster efficient delivery of care. 10 These systems can provide guidance in developing a federal approach.
quate quality in long-term care. For nursing homes, the Commission believes that the recently enacted reforms in requirements for care and in measures for enforcing compliance would provide a firm foundation for quality assurance for broader nursing home coverage.
For home care, the federal government is beginning to experiment with prospective payment methods to replace the cost-based system now in use for Medicare home health care. However, services covered by the Commission's plan would go well beyond the nursing, rehabilitation, and aide services that constitute the bulk of home health care. States providing home and community-based care use a variety of payment methods, including fee schedules or price lists and competitive bidding. Federal guidelines could build on this experience.
For home care, quality assurance mechanisms are less well developed. Inherent in the Commission's design of the home care program are several mechanisms for ensuring quality of care. The federal standards and guidelines the Commission calls for to assess eligibility, as well as certify assessment and case management agencies, are designed primarily to help ensure quality-with a particular emphasis on adequate training. Furthermore, case management itself is an important part of any quality assurance mechanism. In preparing the individual care plan, arranging for services, and conducting periodic reassessments, the case manager frequently develops a personal relationship with the client and family. The case manager thus has the opportunity to monitor the quality of the services being provided formally and informally in the home. The auditing function of the federally certified assessment agency over the case manager decisions provides an additional quality check.
Within these federal guidelines, the Commission recommends that the states be given leeway in administering the public plan. Where long-term care programs already exist, states should build on the current infrastructure for the coordination, management, and delivery of services. In states where the long-term care programs are less developed, the design and implementation of a system would take time. The Commission recommendation provides an opportunity for creativity and experimentation. The Commission expects the standards and guidelines established by the federal government to help less-developed states build their infrastructure to address the unique needs of their communities.
Existing state programs use a variety of providers to deliver home and community-based care services, including agencies, independent contractors employed directly by individuals, and even family caregivers. Given this wide variation, the Commission recommends that the states certify the providers who participate in the public plan, in accordance with federal guidelines.
Federal standards already exist for ensuring the quality of care provided by Medicare home health agencies. Broader standards for certified providers, however, would be needed as the program expands services. Voluntary accreditation programs available through professional or trade associations could help guide the development of standards for home care providers other than home health agencies. Standards are likely to be most effective if they focus on ensuring client participation and clients' rights, use indicators of quality that include both outcome and process measures, monitor personal care and supportive services, and ensure continuity of care and appropriateness of services. 12
A review and appeals process is necessary in order to protect clients' rights to due process with respect to denial and termination of benefits. The Commission recommends that the states be given responsibility for developing a review and appeals process, subject to federal guidelines. Elements from review and appeals processes in current health and disability programs such as Medicare, Medicaid, and Social Security disability could be incorporated into the design of procedures for this new public program. 11
Other mechanisms to ensure quality would also be needed. At the state level, long-term care ombudsman offices mandated by the Older Americans Act are already required to monitor the quality of care in both nursing homes and board and care homes.
13 Ombudsmen are also among the mechanisms some states are using to ensure quality in home and community-based care, and can be encouraged and supported to undertake this task. 14 Other mechanisms could include auditing providers at the point of service, awarding service contracts based on the providers' history of quality service (using past compliance reviews and documented complaints), and establishing quality assurance committees to conduct periodic random reviews of client cases.
Ensuring Quality and Containing Costs
The Commission recognizes that considerable federal and state effort would be required to ensure ade