ON THE ISSUES: MEDICAID AND DEMENTIA
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- Justin Harper
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1 ON THE ISSUES: MEDICAID AND DEMENTIA Mre than 5.5 millin peple in the United States are living with Alzheimer s disease r anther frm f dementia. Nearly 25 percent f these individuals receive care thrugh the Medicaid prgram, the federal-state health insurance prgram fr lw-incme individuals, as well as certain lder adults and peple with disabilities. Medicaid cvers many services and supprts that are essential t the health and well-being f peple living with dementia but that are nt cvered by private insurance and Medicare, such as institutinal and cmmunity based lng-term services and supprts, transprtatin, and respite fr caregivers. The brad array f supprts and services make the prgram indispensable fr many individuals with significant health care needs. What is Medicaid? Medicaid is the health insurance prgram fr lw-incme adults, children, pregnant wmen, lder adults, and peple with intellectual and physical disabilities wh have high medical bills and limited resurces. The precise eligibility criteria varies frm state t state, as each state administers its wn Medicaid prgram, in accrdance with brad general requirements established by the federal gvernment. This results in significant differences in eligibility criteria and cvered services acrss the cuntry. In 2016, Medicaid spending natinwide was apprximately $553 billin and the prgram cvered ver 70 millin peple.i Medicare, n the ther hand, is the federal health insurance prgram fr peple ver the age f 65 and peple with disabilities. In Medicare, states d nt determine eligibility r cverage. Medicaid is a state and federal partnership that prvides health insurance fr a wide range f individuals, including certain incme-eligible adults, parents, children, pregnant wmen, lder adults, and peple with disabilities. The precise eligibility criteria varies frm state t state. Medicare is a federal health insurance prgram fr certain individuals. This includes peple ver the age f 65, peple wh have received Scial Security Disability Insurance fr 24 mnths, and individuals with End Stage Renal Disease r Amytrphic Lateral facebk.cm/leadcalitin
2 SERVICES COVERED BY MEDICAID: Why is Medicaid imprtant fr peple with Alzheimer s disease and ther frms f dementia? Lng-term care in nursing hmes Assisted living Hme and cmmunity-based services including: Dental Visin Persnal Care Hmemaker Supprts Hearing care Respite fr Family Caregivers Adult Day Services Medicatin Management Nn-emergency medical and nn-medical transprtatin There are mre than 5.5 millin Americans living with Alzheimer s disease r anther frm f dementia. ii It is estimated that 1.4 millin Americans live with Lewy bdy dementia iii, and at least 50,000 peple living with frnttempral degeneratin iv, and many mre living with ther frms f dementia, like vascular dementia. The Alzheimer s Assciatin estimates that care csts f dementia will reach an estimated $259 billin in v Of that amunt, Medicare and Medicaid will accunt fr $175 billin, r 67 percent, f the ttal health care and lng-term care payments, while ut-f-pcket spending is expected t be $56 billin. vi Average annual Medicaid spending fr an lder American with dementia is $8,182, while the cst fr a senir withut dementia is nly $349. vii Nearly all peple with dementia in the United States are n Medicare viii, with the exceptin f apprximately 275,000 individuals with yung-nset dementia wh are nt autmatically eligible. ix Nearly 25 percent f individuals with dementia n Medicare als are enrlled in Medicaid. These individuals wh are dually eligible fr bth Medicare and Medicaid receive different supprts and services frm the tw prgrams. Medicare cvers primary and acute care, such as inpatient hspital care, as well as sme dctr visits and ther medical services. Medicare may cver shrt-term care at a skilled nursing facility n a limited basis r hme health care under certain circumstances. Additinally, Medicare Part D cvers utpatient prescriptin drugs. Apprximately 9.9 millin peple, r 25 percent f all Medicare beneficiaries, are knwn as dual eligibles meaning they qualify fr bth Medicare and Medicaid benefits and receive different services and supprts frm each prgram. x Medicaid is an imprtant surce f cverage, even fr individuals wh als have Medicare because the service needs f peple living with dementia ften vastly exceed what Medicare cvers. Medicaid prvides assistance with Medicare cst-sharing, as well as lng-term services. Out-f-pcket csts ften are high and mst Americans lack lng-term care insurance. Fr thse wh qualify, Medicaid cvers sme f the essential services Medicare des nt. Medicaid is essential fr many peple with dementia, particularly when they need t permanently live in assisted living r nursing hme settings, which are nt cvered by Medicare. SERVICES COVERED BY MEDICARE: Physician services Inpatient Hspital Shrt-term Skilled Nursing Facility and Inpatient Rehabilitatin Care Hme health Prescriptin Drugs LEAD Calitin Page 2 f 9
3 Medicaid and Family Caregivers Mst peple with dementia rely n family r ther unpaid caregivers fr help with everything frm activities f daily living t scial interactin. Medicaid cvers the primary, acute, and lngterm services and supprts (LTSS) needs f millins f lw-incme Americans f all ages. In sme cases, Medicaid als assists these caregivers with lng-term services and supprts like respite services, adult day health prgrams. It may als prvide training and supprt t caregivers. Sme states als administer assessments that determine if the caregiver has any specific needs and identify ther prgrams available t assist them. With limited cverage under Medicare and few affrdable ptins in the private insurance market, Medicaid will cntinue t be the primary payer fr a range f institutinal and cmmunity-based LTSS fr peple with dementia and fr caregivers needing assistance with daily care tasks. Natinwide, mst LTSS are prvided by unpaid caregivers, like relatives and friends, in hme and cmmunity-based settings that allw many with LTSS needs t age in place. Accrding t a 2015 natinal survey, Caregiving in the U.S., xi mst family caregivers are wmen age 50 and ver wh care fr a parent while maintaining utside emplyment. This unpaid care ranges frm help with getting t medical appintments, r paying bills t mre intensive care such as assisting with bathing r wund care. As a persn s daily care needs becme mre extensive, paid LTSS delivered by direct care wrkers medical prfessinals (such as physicians r nurses) r para-prfessinals (such as nurse aides r persnal attendants) may be required in additin t r in place f family caregiver services. Given the degenerative nature f dementia and its curse ften running beynd a decade, LTSS is particularly vital t help individuals remain in their wn hmes and avid premature institutinalizatin. Sme f the persnal care services may be cvered by Medicaid. Medicaid and Lng-Term Care Financing Lng-term services and supprts (LTSS) encmpasses the brad range f paid and unpaid medical and persnal care assistance that peple may need when they have difficulty cmpleting self-care tasks because f aging, chrnic illness, r disability. LTSS help with activities f daily living like eating, bathing, and dressing, and instrumental activities f daily living like preparing meals, managing medicatin, and husekeeping. LTSS include, but are nt limited t, nursing facility care, adult day health prgrams, hme health aide services, persnal care services, and transprtatin, as well as assistance prvided by a family caregiver. Care planning and care crdinatin services are a required cmpnent f Medicaid hme and cmmunity-based LTSS. These supprts help beneficiaries and families navigate the health system and ensure that the prper prviders and services are in place t meet beneficiaries needs and preferences; these services can be essential fr LTSS beneficiaries wh ften have substantial acute care needs as well. Natinally, Medicaid finances mre than half f all paid LTSS. xii LEAD Calitin Page 3 f 9
4 Medicaid Hme and Cmmunity-Based Services (HCBS) States have a great deal f flexibility in hw they design their state systems f Hme and Cmmunity-Based Services. States can include services and supprts in their state plan. There are many state plan ptins, including the 1915(c) HCBS Waivers, 1915(i) HCBS State Plan Optin and 1915(k) Cmmunity First Chice Optin. The mst cmmn way states have prvided HCBS is thrugh the Medicaid Hme and Cmmunity-Based Services waiver prgram authrized under Sectin 1915(c) f the Scial Security Act. The HCBS waivers allw states t set up demnstratins r pilts t prvide services that allw thse wh need care t receive thse services in their hmes r cmmunities. Under a waiver prgram, a state can waive certain Medicaid prgram requirements allwing the state t target services and supprts t certain ppulatins and t impse caps n the number f enrllees, ften resulting in waiting lists fr thse services in the state. States frequently have used the 1915(c) HCBS waiver prgram t tailr services and supprts t individuals with Alzheimer s and dementia. Waivers can be used alng with federal, state, and lcal prgrams, such as Medicaid state plans and Administratin n Aging grants. HCBS waivers usually are targeted t specific ppulatins. Sme f the mst cmmn target grups include: Individuals with intellectual and develpmental disabilities, which culd include autism; Older adults and peple with physical disabilities; Medically fragile and palliative care; and Individuals with traumatic and/r acquired brain injuries. Self-directed services Self-directed services like the Cash and Cunseling prgrams allw family members and friends f a Medicaid beneficiary t be paid as caregivers. Cash and Cunseling prgrams are based n Medicaid HCBS waivers. These prgrams can help peple with dementia get the care they need, when they want it, in their hme while prviding financial supprt fr a caregiver f their chice. The prgram participant (the individual in need f assistance) hires their family member r friend as their persnal care prvider. This prvides the beneficiary with cash assistance and with the flexibility t "cnsumer direct" r self-direct the spending f their resurces n care prviders f their chsing. Mst states have their wn names fr their Cash and Cunseling LEAD Calitin Page 4 f 9
5 Prgrams, typically assciated with a specific Medicaid waiver: IndependentChices in Arkansas, In Hme Supprtive Services in Califrnia, and the Chice Waiver in Michigan. Presuming the individual in need f care is already Medicaid-eligible, these prgrams typically wrk as fllws: 1) An assessment t determine the beneficiary s care needs; this includes interviews with caregivers and the beneficiary s physicians; 2) A determinatin is made regarding hw many care hurs per mnth are required; 3) The benefit amunt r budget is calculated using the number f care hurs and cst f care fr that specific gegraphic area. This budget can be increased r decreased as the beneficiary s needs change. Prgram participants are cnsidered t be emplyers, and they decide hw t allcate the budget they are given. They can hire family members as emplyees, including their adult children, and in sme states, even spuses. Mst prgrams d nt exclude the adult children, in-laws r grandchildren. Payment rates t the care prviders are determined by the prgram rules r by the fiscal intermediaries. Typically, care prviders are paid an hurly rate several dllars per hur less than the state's hurly average fr hme care wrkers. Research frm the Cash and Cunseling prject prvides sme imprtant insights int the benefits f participant directin. Evaluatin results shwed that: xiii Participant directin significantly reduced the unmet needs f Medicaid cnsumers wh require persnal assistance services; Participants experienced psitive health utcmes; Quality f life fr participants and their caregivers imprved; The prgram did nt result in misuse f Medicaid funds r abuse f cnsumers; and It prved t be a cst-effective ptin per member. Demand fr participant directin is rising because many peple, including thse in earlier stages f dementia, want cntrl and independence. This makes participant directin a breakthrugh fr lng-term care. LEAD Calitin Page 5 f 9
6 What wuld Medicaid cuts, impsitin f per capita caps r blck grants mean fr peple with Alzheimer s disease r ther frms f dementia? The Trump Administratin and its allies in Cngress aim t radically restructure Medicaid by limiting federal funding t states thrugh per capita caps r blck grants. Artificially limiting the amunt f spending per Medicaid beneficiary wuld be devastating fr many peple living with dementia and their family caregivers. Shifting csts t the states wuld frce states t cut eligibility, reduce benefits, and lwer prvider reimbursement, particularly fr high-cst enrllees wh need substantial services under the prgram. xiv Inevitably, cuts t the Medicaid prgram will result in enrlling fewer peple, cutting services and supprts, r bth. Capping federal cntributins t Medicaid wuld put states with larger aging ppulatins at a disadvantage and harm state residents. Per capita cap prpsals ignre the real grwth rate in health and lngterm care csts and the rapidly rising number f Americans living with dementia. If enacted, per capita caps will frce states t take actins such as tightening eligibility fr Medicaid, remving peple wh currently have cverage frm the prgram, cutting services r reducing Medicaid payments t service prviders. In additin, Medicaid cuts will have a negative impact n the direct care wrkfrce, lwering wages and prmting staff turnver. Required cuts t Medicaid wuld accelerate ver time, with mst ging int effect beginning in 2020, just as many baby bmers begin t need hme and cmmunity-based services. xv Accrding t the 2014 Lng-term Services and Supprts Expenditure Reprt, in 2014, fr the first time in the Medicaid prgram s histry, mre than half f Medicaid funding fr lng-term care (53 percent) was spent n hme and cmmunity-based services aimed at keeping peple f all ages ut f institutins. xvi Hwever, states need t d mre t rebalance their systems t prvide mre access t hme and cmmunity-based services. There is a great deal f variatin acrss states. The cst f care at hme is usually significantly lwer than in an institutin, and mst peple want t remain in their wn hmes as lng as pssible. Strng HCBS systems help prevent premature institutinalizatin with its assciated higher csts. Genwrth Financial reprts that, in 2016, the natinal median cst f DID YOU KNOW? In 2017, there were 74 millin peple n Medicaid with $553 billin in payments 9.9 millin peple are eligible fr bth Medicare and Medicaid 24% f peple with dementia are n Medicaid 17.3 millin peple n Medicaid received hme health services in FY 2016 ttaling $6.3 billin in payments 1.2 millin peple n Medicaid received persnal care services in FY 2016 ttaling $11.5 billin in payments xviii In 2016, 15.9 millin family and friends prvided 18.2 billin hurs f unpaid assistance t thse with Alzheimer's and ther dementias, a cntributin t the natin valued at $230.1 billin xiv 5.5 millin Americans live with Alzheimer s disease r ther frms f dementia 1.4 millin peple (estimated) have Lewy bdy dementia 50,000 peple (estimated) have frnttempral degeneratin Apprximately 275,000 are yunger than age 65, with early-nset Alzheimer s disease LEAD Calitin Page 6 f 9
7 a shared nursing hme rm was $82,125 annually, while the median cst f a hme health aide was $46,332 annually fr 44 hurs f supprt each week. xvii While HCBS are mre cst-effective, these services are ptinal fr states. Nursing facility services are mandatry. Under per capita caps, many states wuld be frced t cut back n HCBS, in turn placing mre unsustainable burden n family caregivers trying t supprt their lved nes at hme and resulting in greater reliance n cstlier institutinal care. The Impact f Medicaid Expansin The Affrdable Care Act expanded the availability and eligibility f the Medicaid prgram, which 32 states adpted as f In these expansin states, Medicaid cverage eligibility includes nearly all adults up t 138 percent f the federal pverty level. In a literature review f mre than 100 studies, researchers at the Kaiser Family Fundatin fund states that expanded Medicaid saw gains in cverage and lwer uninsured rates than states that did nt expand their Medicaid prgrams. The review als fund that expansin imprved access t care, utilizatin f services and financial stability fr Medicaid beneficiaries. xviii Medicaid expansin is particularly imprtant fr peple wh may have been diagnsed with yung nset Alzheimer s disease but wh are nt able t establish Medicaid eligibility thrugh a disability-related grup. These participants wuld nt be eligible fr Medicare and wuld likely struggle t receive the supprts and services necessary t manage their disease withut this Medicaid cverage grup. LEAD Calitin Page 7 f 9
8 Issue Brief Recmmendatins Maintain the current Medicaid funding system t ensure that the prgram is able t meet the needs f an expanding aging ppulatin and grwing number f peple living with Alzheimer s disease and ther frms f dementia. D nt impse Medicaid funding limits r per capita caps and d nt restructure Medicaid int a blck grant prgram fr states. Cntinue t assist states t rebalance their Medicaid prgrams t encurage greater utilizatin f hme and cmmunity-based services and reduce premature institutinalizatin. Increase ptins fr individuals and families t self-direct their HCBS t better meet their needs. Enhance supprt fr family caregivers within Medicaid, including assessment f caregiver needs and access t evidence-based family supprt prgrams. Abut the LEAD Calitin Leaders Engaged n Alzheimer s Disease (LEAD Calitin) is a diverse and grwing natinal calitin f mre than 90 member rganizatins cmmitted t vercming Alzheimer s disease and ther frms f dementia. The calitin wrks cllabratively t fcus the natin s attentin n accelerating transfrmatinal prgress in: (1) care and supprt t enrich the quality f life f thse with dementia and their caregivers; (2) detectin and diagnsis; and (3) research leading t preventin, effective treatment, and eventual cures. Jin Us Online We invite yu t learn mre abut the LEAD Calitin by fllwing us Facebk.cm/LEADCalitin Subscribe at LEAD Calitin Page 8 f 9
9 Abut This Brief The LEAD Calitin staff, member rganizatins, and ther natinal experts authred the brief. Please nte that this brief des nt represent the cnsensus f the LEAD Calitin r individual alliance member rganizatins. Share feedback and questins by ing inf@leadcalitin.rg. Last revised: December 18, 2017 i ii iii iv v vi vii viii ix x xi xii xiii xiv xv xvi xvii xviii xviii xiv Statistics-Reference-Bklet/2016.html LEAD Calitin Page 9 f 9
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