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BRIEF REPORTS |
a The MEDSTAT Group, Cambridge, MA
Correspondence: Brian Burwell, The MEDSTAT Group, 125 CambridgePark Drive, Cambridge, MA 02140. E-mail: Brian.Burwell{at}medstat.com.
Decision Editor: Laurence G. Branch, PhD
In federal Fiscal Year (FY) 2000, Medicaid long-term care expenditures increased 8.6%, from $62.3 billion to $67.7 billion (see Table 1 ). This was higher than the rates of increase in long-term care spending over the prior 2 years, which were in the 5% to 6% range. Medicaid long-term care expenditures increased at a slightly higher rate than overall Medicaid spending, which increased 7.9%, from $180.1 billion to $194.3 billion.
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Home- and community-based services (HCBS) waivers, which increased 14.6% in FY 2000 to $12.0 billion, are still the most rapidly growing Medicaid long-term care benefit. Spending for personal care services increased 7.6% in FY 2000 to $3.8 billion. Medicaid expenditures for skilled home health care services remained relatively flat in FY 2000, as they have in recent years.
Overall, Medicaid spending for institutional services (nursing home care plus ICF-MR care) comprised 73% of all Medicaid long-term care spending in FY 2000, whereas spending for community-based services (personal care, HCBS waivers, and home health services) comprised 27% of total expenditures.
Table 2 arrays the state-specific rates for these Medicaid long-term care services. The top five states in long-term care per capita expenditures in 2000 were New York, Connecticut, North Dakota, Pennsylvania, and Rhode Island, with North Dakota replacing Washington, DC, from 1999 to 2000.
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Center for Medicare and Medicaid Services 2001) submitted by states to the Center for Medicare and Medicaid Services (formerly known as the Health Care Financing Administration). The HCFA 64 is the form used by states to claim federal financial participation for state Medicaid outlays and is audited by the federal government. It is thus considered to be one of the most reliable sources of information on state Medicaid spending. However, it is important to reiterate some caveats in the interpretation of these data. First, HCFA 64 data are filed by date of payment, not date of service. Thus, rates of change in state Medicaid spending for specific services, as reported on the HCFA 64, can be related to state payment policies as well as to real changes in service utilization by Medicaid beneficiaries. For example, simply by delaying one month's payments to nursing home providers from June 30th to July 1st, a state can push 13 months of nursing home spending into a later fiscal year, leaving only 11 months of nursing home payments in the earlier year. These kinds of "bill paying" practices definitely occur in some states, usually in response to budgetary pressures.
Second, HCFA 64 reports represent state claims to the federal government of health care expenditures that states believe are eligible for federal matching funds under the Medicaid program. As a result of its audit process, HCFA may disallow some of these claims as not eligible for federal matching funds, which are then adjusted on future HCFA 64 reports. These adjustments are not reported by type of service and, therefore, cannot be used to adjust previously reported data on Medicaid spending by type of service.
Third, HCFA 64 reports on Medicaid spending by type of service only represent Medicaid fee-for-service spending, not spending for services provided through capitated managed-care programs. Because long-term care recipients (and/or long-term care benefits) are usually exempt from participation in Medicaid managed-care programs, the growth in managed-care enrollment should not have a large impact on HCFA 64 reports of spending for long-term care services. However, Arizona's entire long-term care system is capitated, and the author-available tables only include fee-for-service expenditures in Arizona's long-term care system (persons newly eligible for long-term care services in Arizona may receive long-term care services on a fee-for-service basis before enrolling in a managed-care plan). In addition, a few other states (e.g., Minnesota and Texas) have recently implemented relatively large managed-care long-term care programs that pay for services on a capitation basis. Also, increased enrollment of Temporary Assistance for Needy Families-related recipients and Supplemental Security Income recipients who are not dual eligibles into managed-care programs may be affecting reported spending on the HCFA 64 for personal care and Medicaid home-health benefits.
Lastly, HCFA 64 reports on long-term care expenditures are sometimes erroneous. States occasionally call and question the data reported in the annual MEDSTAT memorandum (e.g.,
Burwell 2000), particularly in regard to HCFA 64 reports on HCBS waiver spending. In some cases, this is because HCBS waiver expenditures are reported on another line of the HCFA 64, usually the "Other" service line. The MEDSTAT Group has produced another memorandum (
Eiken and Burwell 2001), which summarizes HCFA 64 reports on expenditures for individ-ual waiver programs. Most states operate multiple HCBS waiver programs for different long-term care populations.
Received for publication June 1, 2001. Accepted for publication June 14, 2001.
References
This article has been cited by other articles:
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  P. Nadash Two Models of Managed Long-Term Care: Comparing PACE With a Medicaid-Only Plan Gerontologist, October 1, 2004; 44(5): 644 - 654. [Abstract] [Full Text] [PDF]
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D. Street, J. Quadagno, L. Parham, and S. McDonald Reinventing Long-Term Care: The Effect of Policy Changes on Trends in Nursing Home Reimbursement and Resident Characteristics--Florida, 1989-1997 Gerontologist, April 1, 2003; 43(90002): 118 - 131. [Abstract] [Full Text] [PDF]
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