In 2020, an estimated 5.8 million folks used paid long-term companies and helps (LTSS) delivered in dwelling and neighborhood settings and 1.9 million used LTSS delivered in institutional settings, in accordance with CBO estimates. Most individuals ages 65 and older and many individuals beneath age 65 with disabilities have Medicare, however Medicare doesn’t cowl most LTSS and as a substitute, Medicaid is the first payer for LTSS. To qualify for protection of LTSS beneath Medicaid, folks should meet state-specific eligibility necessities concerning their ranges of earnings, wealth, and useful limitations. An unknown, however in all probability even bigger variety of folks, used unpaid LTSS that’s supplied by household, buddies, or neighbors. LTSS embody the broad vary of paid and unpaid medical and private care companies that help with actions of every day dwelling (comparable to consuming, bathing, and dressing) and instrumental actions of every day dwelling (comparable to making ready meals, managing medicine, and housekeeping). They’re supplied to individuals who want such companies due to getting older, continual sickness, or incapacity, and embody nursing facility care, grownup daycare applications, dwelling well being aide companies, private care companies, transportation, and supported employment. These companies could also be supplied over a interval of a number of weeks, months, or years, relying on a person’s well being care protection and degree of want.
There have been longstanding challenges discovering sufficient employees to supply LTSS for all individuals who want such companies, and the COVID-19 pandemic exacerbated these points significantly. In response to the pandemic, the federal government promulgated new initiatives to assist enhance security and high quality in nursing amenities, and created the first-ever set of high quality measures for dwelling and community-based companies (HCBS), however these steps are unlikely to handle long-standing challenges in financing and offering LTSS. The federal authorities additionally supplied states with short-term authorities and funding to supply new or further LTSS in the course of the pandemic, however these authorities and funding are time-limited. Because the inhabitants ages and as advances in medication and expertise allow folks with severe disabilities to reside longer, the variety of folks in want of LTSS is anticipated to develop. Trying ahead, there’ll seemingly be continued curiosity amongst policymakers in increasing the supply of LTSS and bettering their high quality, although figuring out the assets to take action can be difficult.
1. With over one-fifth of all U.S. COVID-19 deaths occurring in long-term care amenities, the pandemic highlighted ongoing points with LTSS.
Over 209,000 COVID-19 deaths, or simply over each one in 5 COVID-19 deaths, has been in a long-term care facility (together with nursing properties, assisted dwelling amenities, ICF/IIDs, and different settings) (Determine 1). These deaths highlighted many ongoing challenges for such amenities together with quickly rising demand for LTSS that outpaced out there assets, employee shortages, improper an infection management measures, and isolation amongst folks dwelling in establishments. In early 2022, the Biden Administration introduced new initiatives centered on bettering nursing facility care high quality, oversight, knowledge transparency, profession pathways, and pandemic and emergency preparedness. Key coverage proposals embody establishing minimal staffing ranges for Medicare and Medicaid-certified nursing amenities, strengthening oversight of poor-performing nursing amenities, supporting state efforts to tie Medicaid reimbursement charges to will increase in workers compensation, and launching a nationwide nursing profession pathways marketing campaign to recruit, practice, and retain long-term care workers, amongst others. In August 2022, the administration additionally launched a brand new research to tell minimal staffing necessities for nursing properties. A number of states additionally enacted vaccine mandates for nursing dwelling employees. Early proof means that these mandates resulted in increased charges of vaccination amongst workers with none enhance within the frequency of reported staffing shortages.
2. LTSS are extraordinarily costly and never coated by Medicare.
In 2021, the median annual prices of care within the U.S. have been $108,405 for a personal room in a nursing dwelling, $54,000 for an assisted dwelling facility, and $61,776 for a house well being aide prices (Determine 2). These prices signify what folks could be anticipated to pay if they didn’t qualify for Medicaid. (A small variety of folks have personal long-term care insurance coverage, which helps defray these prices.) Nursing facility prices have been increased than the prices of different companies however many individuals dwelling exterior of nursing amenities use a number of companies concurrently. Virtually all LTSS prices exceeded the median earnings for Medicare beneficiaries in 2019. The prices of 1 12 months of nursing facility care exceeded the median financial savings for Medicare beneficiaries in 2019 ($73,800), which means over half of individuals on Medicare should not have ample financial savings to pay for one 12 months of nursing facility care.
Medicare supplies dwelling well being and expert nursing facility care beneath particular circumstances, however the Medicare profit is taken into account “post-acute” care and customarily not out there for folks needing companies on an ongoing foundation. There are 8.0 million Medicare beneficiaries who meet the earnings, wealth, and well being necessities for Medicaid and are enrolled each applications (generally known as “twin eligibles”). (An extra 3.3 million Medicare beneficiaries are enrolled in Medicaid however solely obtain protection of Medicare premiums and in some instances, price sharing.) For Medicaid-Medicare enrollees with full Medicaid advantages, Medicare is the first payer for acute and post-acute care companies and Medicaid covers ongoing LTSS. Medicaid performs a key position in affordability and entry to LTSS for individuals who qualify as a result of LTSS prices could also be troublesome for folks to afford when paying out-of-pocket. In some instances, folks solely qualify for Medicaid after exhausting their financial savings on the prices of LTSS. The proportion of Medicare beneficiaries who’re enrolled in Medicaid varies broadly by state. Such variation displays variations in state coverage, and within the earnings and wealth distribution of Medicare beneficiaries throughout the states.
3. The U.S. spent over $400 billion on LTSS in 2020, practically 10% of all Nationwide Well being Care Expenditures.
In 2020, Medicaid paid 54% of the over $400 billion spent on LTSS within the U.S., folks paid a further 13% out-of-pocket, personal insurance coverage paid 8%, and different private and non-private payers paid the remaining 26%. Residence and community-based companies (HCBS) embody residential care amenities, Medicaid dwelling well being companies, and Medicaid HCBS waiver companies. Spending on these companies was $245 billion and the remaining $157 billion was spent on institutional LTSS comparable to nursing facility care (Determine 3). These totals exclude $86 billion in Medicare spending on post-acute care, and spending on dwelling well being that was paid out-of-pocket ($13 billion), by personal well being insurers ($16 billion), and by different private and non-private payers ($14 billion). These estimates exclude spending on dwelling well being by payers apart from Medicaid as a result of most companies in that class are acute care comparable to sturdy medical tools supplied at dwelling or care following a serious surgical procedure or hospitalization. Medicaid dwelling well being spending contains each acute care and LTSS, however it’s seemingly that almost all dwelling well being is supplied on an ongoing foundation within the Medicaid program. The institutional spending numbers exclude the room and board prices related to assisted dwelling amenities, that are thought of home-based settings. The companies delivered in assisted dwelling amenities, comparable to dwelling well being and private care, can be thought of HCBS and coated beneath Medicaid as dwelling well being and private care advantages.
4. Greater than half of LTSS spending pays for dwelling and community-based companies, however there may be great variation throughout states.
LTSS could also be supplied in numerous settings which can be broadly categorized as institutional or non-institutional. Institutional settings embody nursing amenities and intermediate care amenities for folks with mental disabilities. Companies supplied in non-institutional settings are referred to as dwelling and community-based companies (HCBS), and these settings might embody an individual’s dwelling, grownup day care facilities, assisted dwelling settings, and group properties. Federal Medicaid statutes require states to cowl institutional LTSS and residential well being, however the the rest of HCBS are non-compulsory. Even with out a mandate to cowl HCBS, Medicaid LTSS spending has shifted from institutional to non-institutional settings over time. That shift displays beneficiary preferences for receiving care in non-institutional settings and necessities for states to supply companies within the least restrictive setting attainable stemming from the Olmstead resolution. In most states, not less than half—and infrequently considerably greater than half—of LTSS spending was on HCBS in Fiscal Yr 2019. Nonetheless, there may be substantial state variation within the share of Medicaid LTSS expenditures which can be spent on HCBS, starting from 33% in Mississippi to 83% in Oregon. 4 states (Oregon, Minnesota, Arizona, and New Mexico) spent over 75% of their whole Medicaid LTSS spending on HCBS, whereas 18 states spent beneath 50% (Determine 4).
5. Most Medicaid LTSS spending is for people who find themselves ages 65 and over or who’re beneath age 65 with disabilities.
The overwhelming majority of Medicaid LTSS spending is amongst those that are 65 or older or beneath age 65 and eligible for Medicaid on the premise of incapacity (Determine 5). In CY 2019, such enrollees comprised practically 95% of fee-for-service (FFS) LTSS spending however lower than 25% of enrollment. These totals embody spending on institutional and non-institutional care, however exclude spending paid for by managed care plans. Though nearly all of LTSS remains to be paid for immediately by states, using managed care to supply LTSS has elevated over time. Below managed LTSS, states pay premiums to managed care plans and people plans pay for the well being care and LTSS that enrollees use. Medicaid administrative knowledge present how a lot states are spending on the premiums, however don’t typically present how a lot the managed care plans are spending on well being care and LTSS. Consequently, it’s troublesome to apportion the prices of premiums throughout well being care and LTSS.
6. Enrollees ages 65 and older or beneath age 65 with disabilities have increased total Medicaid prices.
Medicaid’s per individual spending for people who find themselves 65 or older or beneath age 65 with disabilities is considerably increased than it’s for different enrollees (Determine 6). In CY 2019, per enrollee spending for nonelderly adults who have been eligible for Medicaid on the premise of incapacity was over 5 occasions increased ($19,520) than that of kids and nonelderly adults who have been eligible on a non-disability foundation ($3,247). Increased spending was attributable to elevated spending on FFS LTSS and better premiums for managed care.
For many Medicaid enrollees 65 or older and plenty of enrollees with disabilities, Medicare additionally supplies medical insurance. For these Medicare-Medicaid enrollees, Medicare is the first payer for a lot of medical companies together with hospitalizations, doctor visits, pharmaceuticals, preventive companies, expert nursing care, dwelling well being care, and hospice care. Medicaid supplies protection of Medicare premiums, price sharing, and advantages that aren’t included within the Medicare program. Excessive Medicaid spending amongst Medicare-Medicaid enrollees—who’ve one other type of medical insurance—usually displays substantial LTSS spending amongst this inhabitants.
7. States should present institutional care and residential well being, however most home- and community-based companies are non-compulsory.
Medicaid LTSS spending is shifting towards HCBS settings, however most main HCBS are non-compulsory for states to cowl beneath Medicaid. The required HCBS are dwelling well being companies (outlined as part-time or intermittent nursing companies); dwelling well being aide companies; and medical provides, tools, and home equipment appropriate to be used within the dwelling. In 2020, about 734,500 folks acquired necessary dwelling well being companies and these companies accounted for about 4.4% of Medicaid HCBS spending. Practically 2 million folks used different non-compulsory state plan companies and practically three million folks used companies by way of non-compulsory waiver applications (Determine 7). The variety of HCBS customers proven in Determine 7 is decrease than the variety of customers reported by the Facilities for Medicare & Medicaid Companies (CMS), which discovered that round 8 million Medicaid beneficiaries used HCBS in 2019, together with 2.3 million individuals who used dwelling well being. The rationale CMS knowledge present increased numbers of customers is that these knowledge outline anybody with a number of claims for a given service as an HCBS consumer, whereas the info in Determine 7 seize the inhabitants who use HCBS on an ongoing foundation.
Optionally available Medicaid HCBS embody private care to assist with bathing or making ready meals, therapies to assist folks regain or purchase self-care and unbiased dwelling expertise, and assistive expertise. They might be supplied by way of state plan profit packages however are extra generally supplied by way of HCBS waivers. HCBS waivers permit states to develop monetary eligibility for HCBS and provide HCBS advantages focused to particular populations, comparable to folks with mental or developmental disabilities (I/DD) or folks with bodily disabilities. In contrast to state plan advantages, HCBS waivers permit states to restrict the variety of folks served and to waive different guidelines governing the availability of institutional care and different forms of well being care. Many states use waivers to limit the variety of folks utilizing HCBS and use waitlists when the variety of folks in search of companies exceeds the variety of waiver slots out there.
8. Inside the largest class of Medicaid HCBS spending, folks with mental and developmental disabilities accounted for over two-thirds of spending.
Practically all states provide part 1915(c) waivers, which permit states to supply LTSS in neighborhood settings as a substitute of amenities. In FY 2020, such waivers accounted for 51% of all Medicaid HCBS spending or about $59 billion out of about $116 billion. Throughout 47 states, 1.9 million folks have been enrolled in 255 Medicaid 1915(c) HCBS waivers. Most of these waivers present companies to a selected inhabitants, comparable to folks over age 65, folks with bodily disabilities, folks with psychological disabilities, or folks with mental and developmental disabilities (I/DD). Individuals with I/DD accounted for lower than half of total Part 1915 (c) waiver enrollment however greater than two-thirds of waiver spending on account of upper per-person spending amongst folks in such waivers (Determine 8). The vary in per-person spending throughout waivers is kind of vital. In 2020, among the many six major populations focused by way of 1915(c) waivers, the individual prices ranged from:
- $7,554 for folks with HIV/AIDs (4 thousand enrollees),
- $11,677 for folks with psychological well being situations (24 thousand enrollees),
- $15,211 for folks 65+ or beneath 65 with disabilities (853 thousand enrollees),
- $23,092 for medically fragile or technology-depending kids (16 thousand enrollees),
- $32,425 for folks with traumatic mind or spinal twine accidents (23 thousand enrollees), to
- $47,392 for folks with I/DD (740 thousand enrollees).
9. Workforce shortages amongst LTSS suppliers have been exacerbated by the COVID-19 pandemic.
The pandemic significantly exacerbated shortages of LTSS employees. Employment ranges in all well being care jobs dropped sharply in the beginning of the pandemic, however for many well being care sectors, employment began to rebound as early as spring 2020. Nonetheless, employment within the LTSS sectors continued to fall properly into 2021 and for nursing amenities, into the start of 2022. Current evaluation on the Peterson-KFF Well being System Tracker exhibits that the variety of employees dropped by 14% in nursing care amenities and by 9% in neighborhood elder care amenities between February 2020 and June 2022 (Determine 9). As of mid-July 2022, over one in 4 licensed nursing amenities within the U.S. reported a scarcity of nurses and/or aides and in 2021, a survey of dwelling care companies reported challenges in from staffing shortages and problem recruiting new workers. Moreover, a 50-state survey of Medicaid HCBS applications discovered that Medicaid HCBS supplier infrastructure declined in the course of the pandemic, with two-thirds of responding states reporting a everlasting closure of not less than one supplier. In the identical survey, states reported that workforce shortages have been the pandemic’s major influence. This isn’t stunning as a result of HCBS suppliers typically report low pay and really poor working situations. KFF carried out focus teams with HCBS employees throughout July and August 2021 and employees reported that the psychological calls for related to caregiving have been “overwhelming” whereas the wages have been low, the hours lengthy, and the working situations usually fairly demanding.
10. Trying ahead, policymakers will proceed to face the problem of offering LTSS and the necessity for LTSS will develop because the inhabitants ages.
Practically one in 5 Individuals is projected to be 65 or older by 2060 (Determine 10). Advances in assistive and medical expertise that permit folks with disabilities to be extra unbiased and to reside longer, along with the getting older of the newborn boomers, will seemingly end in elevated want for LTSS over the approaching many years. An HHS report discovered that after age 65, 57% of individuals would want assist with not less than two actions of every day dwelling, 56% would use paid LTSS, and 39% would use some nursing dwelling care. Anticipated charges of LTSS want and use are highest amongst folks with lifetime earnings within the backside earnings quintile, who’ve the fewest assets to pay for such care.
Though the various deaths from COVID-19 illuminated severe challenges for institutional LTSS, the identical challenges additionally have an effect on HCBS; certainly, the rising demand for care and workforce shortages could also be extra severe for dwelling and neighborhood settings than for establishments transferring ahead. There’s a great dearth of knowledge on folks utilizing HCBS and a major lack of help for paid and unpaid caregivers. The American Rescue Plan included a provision to extend the federal matching charge (FMAP) for spending on Medicaid HCBS by 10 proportion factors to fund quite a lot of actions to develop entry to HCBS and help direct care suppliers. Though states’ present HCBS expenditures are not eligible for the upper FMAP, the federal authorities just lately gave states till March 31, 2025 to spend the additional federal funds they’d already acquired. Different insurance policies which have garnered latest consideration embody completely rising the FMAP for HCBS, making HCBS a compulsory profit, and increasing Medicare protection for seniors who select to go dwelling after a hospital keep moderately than to a talented nursing facility. It is going to be vital to look at whether or not and the way classes from the pandemic are built-in into new insurance policies to enhance entry to and high quality of LTSS within the U.S.