building bridges:
making a difference in long-term care
2005 Colloquium
June 25, 2005
Boston
Funded by the Commonwealth Fund
Conducted by AcademyHealth
THE
COMMONWEALTH
FUND
Consumer-Directed Care and Its
Implications for State and Federal
Long-Term Care Policy
Randall Brown
Building Bridges: Making a Difference in Long Term Care
2005 Colloquium
Funded by The Commonwealth Fund
Conducted by AcademyHealth
Boston, Massachusetts
June 25, 2005
DRAFT: DO NOT CITE OR DISTRIBUTE
What is Consumer Directed Care?
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Giving consumers control over PCS/HCBS
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Type of authorization and state determine
extent of consumer control
– Min.: Who provides care, how, when
– May require worker certification, pre-set
wages
– May permit other uses of allowance
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Goal: Improve consumers' quality of life
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Why Isn’t Consumer Direction the Norm?
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Fear of:
– Inadequate, unsafe care of consumers
– Exploitation of consumers
– Caregiver injuries
– Fraud, misuse of allowance
– Cost increases
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Agency/union opposition
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The Evidence for Consumer Direction
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California IHSS program (Benjamin and Matthias
2001, 2004)
– Consumers assigned, generous benefit levels,
no counseling, allowance for hiring workers
– CD group more satisfied, greater sense of
security, wider choices
– Directly hired workers had lower wages, more
emotional strain
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Cash and Counseling
– Voluntary (random assignment), lower
benefits, counselors, allowance not restricted
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Cash and Counseling
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Implemented in three states (AR, FL, NJ)
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Enrolled Medicaid PCS/HCBS waiver eligibles (10/98 - 7/02)
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Flexible use of benefit allowed
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Consumers could hire legally liable relatives, no Medicaid
contracting requirements
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No screening of eligibles (representatives allowed)
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Counselors helped develop spending plan, monitored it
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Fiscal intermediaries wrote checks, withheld taxes
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1,800 – 2,000 adults in each state; 1,000 children in FL
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Effects on Hours of Care
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Increased % getting any services in two states
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More hours of paid care (17 to 25%)
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Fewer unpaid hours (7 to 24%)
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Slightly fewer total hours of care
– Except AR age 18-64 (-19%), FL 65+ (-12%)
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Little measurable effect on other allowance uses
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Effects on Consumers’ Well-Being
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Large reductions in unmet needs
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Large increases in satisfaction with care
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Care-related health problems/injuries
same or lower
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Satisfaction with life increases greatly
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Works for children, adults < 65, elderly
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Only exception—if few get the allowance
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Effects on Unpaid Caregivers
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Reduced total hours of care provided
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Much more satisfied with consumer’s care,
less worried
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Much less emotional/physical/financial strain
– Fewer adverse effects on work life
– Fewer adverse health effects
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Much greater overall satisfaction with life
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No effects for group whose hours increased
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Hired Workers’ Experience
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Most were relatives, few (5 – 20%) were strangers
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Received same or higher wages as agency workers
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Much more satisfied with wages
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Report less physical strain
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Report more emotional strain
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More want greater respect from consumers’ family
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Greater strain, feelings of disrespect due to family
ties (not caregiving)
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Effects on Medicaid Costs
Cashed out services cost per month of benefits
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Increased for younger adults (all states) and children
– Because control group underserved in AR and NJ
– Because allowance > care plan amount in Florida DD groups
Annual cost per beneficiary in study
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Personal care costs higher
– Higher cost/mo, higher percent receiving
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Other Medicaid costs lower (mostly long term care)
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Total Medicaid cost higher in most states and age groups
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Results diverge in Year 2
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Policy Issues
Results should allay fears about CD care, but:
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Higher costs may deter some states
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Allowance may increase demand for PCS/HCBS
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Paying legally liable relatives is controversial
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Hired relatives face emotional stress, lack respect
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Should consumer direction be advocated?
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Agencies/unions will oppose it
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Implementation Issues Regarding
Eligibility and Allowance
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Eligible population
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Services to cash out (if any)
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Method to set and revise allowance amount
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Uses of the allowance
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Allowable hired workers
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Whether to recoup unspent allowance
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Implementation Issues Regarding
Program Structure/Monitoring
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Counselors’ roles and responsibilities
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Solicitation and payment of a fiscal agent
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Monitoring of spending plans
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Monitoring of counselors’ performance
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Monitoring of costs
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Monitoring time to receiving the allowance
and disenrollment
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Areas for Future Research on
Consumer Direction (1)
Understanding the Effects
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Importance of ability to hire family
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How unmet needs are reduced with fewer
hours
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Mechanism for reduction in other Medicaid
costs
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Longer term effects
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Effect on participation in PCS/HCBS
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Influence on quality of agency care
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Areas for Future Research (2)
Sensitivity and Adaptability
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Effect of higher discount rates on
outcomes
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Amount of counselor contact needed to
prevent exploitation/abuse
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Effect of worker registries on participation
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Adaptability to Medicare home health
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DRAFT: DO NOT CITE OR DISTRIBUTE
building bridges:
making a difference in long-term care
2005 Colloquium
June 25, 2005
Boston
Funded by the Commonwealth Fund
Conducted by AcademyHealth
THE
COMMONWEALTH
FUND