The Ghost of Medicaid Reform Past

Warnings of exploding health care costs, increasing numbers of Medicaid patients, and a limited budget.

These may sound like the words of Health and Human Services Commissioner John Stephen today, but Commissioner Terry Morton raised those alarms in the late 90s.

Like Stephen, Morton wanted to cut back on the most expensive part of Medicaid, nursing home costs.

To do this he launched a program that would provide more ways to people to get the care they need outside of nursing homes.
Adult day care centers received more money, and community residences that weren't quite as nursing intensive as nursing homes popped up.

Former Commissioner Donald Shumway came into office just after the program was enacted.

Early signs showed these changes were making a difference.

Shumway: We made headway. We were able to open up more services and the amount of community based care. And nursing home populations did shrink slowly.

From 2000 to 2001, nursing home enrollment dropped nearly three percent.

Medicaid patients who get long term care need help with basic, day to day activities, like dressing or eating.

Even though they need this kind of care, some don't want to go into a nursing home.

After the program began, those on Medicaid receiving care at home or in the community rose significantly.

Shumway: We actually started making good progress. But I think that progress has been lost and the numbers show it. From 00 to 01 our home and community based care enrollment grew by 18 percent. From 01 to 02 it grew by another 11 percent. It's now growing by rates of 3 or 5 percent. So that's really slowed down.

The dropoff, according to Schumway, was due to limited state dollars.

Without steady increases in funding, adult day care centers had a tough time maintaining the gains from when the program started.

[sounds]

This morning at the Castle Center Adult Day Care in Keene, about a dozen patients are doing exercises in the activity room.

The center looks a bit like a nursing home.

But it doesn't feel like one.

Most of the patients don't use wheelchairs and they don't seem ill.

There's a nurse, but no nurses' station, no intercom system, no private rooms.

And, it costs about half that of a nursing home to take care of someone at Castle Center.

Manager Beverly Lee Packard said the center is essential for needy people who want to live at home, but whose family members work.

Packard: They meet nursing home criteria. If they didn't come here or if they didn't receive the other services, certainly they would qualify for a nursing home. But because they realize that there were other options, that there were other alternatives, they're not in a nursing home.

Louise Blaisdell is 90.

She likes what the center has to offer and she definitely doesn't want to be in a nursing home.

Blaisdell: Why should I, would you? I take care of myself, I keep my room clean, my bed made and my clothes folded up and put away. I'm not the nursing home type.

About 45 patients like Blaisdell come to the Castle Center daily, and a third of them are on Medicaid.

When the new program started, The Castle Center saw its reimbursement rates for caring for Medicaid patients rise from 27 to 45 dollars a day.

That was five years ago.

How much have rates changed since then?

Packard: Nothing.

Beverly Lee Packard.

Packard: We really do suffer because we're not getting reimbursed what our actual costs are. And that's true for other centers as well.

With rates as they are, Castle Center relies on fund raising, volunteers, and paying their care providers close to minimum wage.

The problem of low wages stood out in a report on the progress of Morton's program written in 2002.

The author of that report, Catherine Keane, says that people could make the same amount of money at less physically and emotionally taxing jobs.

Keane: Where they might have been paid 9 dollars an hour to help take care of an elderly person living at home, it was maybe more attractive to go get a job in a service position in retail or somewhere else in the economy. So long term care providers were competing for a very limited pool of workers.

Staffing was one problem, housing another.

David Frydman was part of the effort that tried a novel way of reducing nursing home numbers: actually taking people out of nursing homes and putting them back in the community.

Frydman: One of the major barriers when we tried to move the 28 folks out that we found was housing. We had people that were waiting in nursing homes for as long as a year at roughly 4000 dollars a month. Who couldn't find either an accessible unit in the community or a unit where they'd be able to get services.

Frydman points to a lack of investment in the basic infrastructure, like appropriate housing that limited any progress that Morton's program could accomplish.

Keane, who analyzed the project, says that New Hampshire has typically focused funding on nursing homes.

Keane: So we have plenty of nursing home beds throughout the state. But we do have a lack of supports in communities, particularly in rural areas, that help support people to stay at home.

Keane says that it's not just throwing money into the system that will make a difference, but sustaining the investment year after year.

Keane: For example, I'm remembering that there was a 60,000 dollar increase statewide for adult day care in social services in last budget go around. It's that kind of nominal increase that I think is not what I really consider to be a major investment in the support system of care.

John Poirier, who represents nursing homes with the New Hampshire Health Care Association adds a cautionary note.

Community and home care only work when a person can get by on less care than what a nursing home provides.

And Poirier contends that finding those who need the help that's available in a nursing home, but can get by without it, is tough to do.

Poirier: I think it's very important for people to take half an hour and go to a nursing home. Walk through a nursing home and tell me which 30 percent of the people who are there really shouldn't be there. I would argue that that would be a very difficult half an hour for whoever was trying to say These 30 people need to leave.

This may be the ultimate limit to shifting long term care away from nursing homes.

Still, everyone agrees, even Poirier, that Morton's plan gave people more options for their long term care.

But without adequate funding, it has had limited results.

And the issue persists today.

Just last week House members approved a bill that echoes many of Morton's long term care goals.

But the measure may never make it to the Senate.

Lawmakers are struggling over the money.

For NHPR, I'm Kerry Grens

For more on Medicaid, read our Medicaid: Basic Facts page