Medicaid Long-Term Care:

Successful State Efforts to Expand Home Services While Limiting Costs

HEHS-94-167: Published: Aug 11, 1994. Publicly Released: Aug 11, 1994.

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Pursuant to a congressional request, GAO reviewed three states' experiences in expanding government-funded home and community-based health care services, focusing on: (1) the extent to which these states have shifted their long-term care to home and community-based settings; (2) controls for managing the costs and growth of home and community-based programs; and (3) the impact the shifts and controls have had on long-term care services.

GAO found that: (1) all three states have expanded federal and state funded home and community-based long-term care programs to better serve residents' long-term care needs and help control growing Medicaid costs; (2) the three states have had to limit program growth to meet federal Medicaid capacity limits and conform with constrained state budgets; (3) state agencies have had to limit access to home and community-based services and prioritize program recipients because funding needs have exceeded budget allocations; (4) limiting recipients' access to services has resulted in waiting lists for some programs; (5) states have been able to increase service coverage and lower the costs of providing services because home and community-based care is generally less expensive per person than Medicaid-funded institutional care; (6) home and community-based health services are an important alternative to nursing facility care; (7) although the total number of nursing facility beds increased by 20.5 percent between 1982 and 1992, the combined number of beds in the three states declined by 1.3 percent; and (8) the three states have accommodated all or most of the growth in their long-term care programs.

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