Older Americans Act:

More Federal Action Needed on Public/Private Elder Care Partnerships

HRD-92-94: Published: Jul 7, 1992. Publicly Released: Jul 7, 1992.

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Sarah F. Jaggar
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Pursuant to a congressional request, GAO provided information on the Administration on Aging's (AOA) policy on private corporations purchasing government agency services, focusing on: (1) whether states have developed policies that permit elder care contracts between corporations and area agencies on aging; and (2) whether states adequately ensure that their public mission will be preserved when area agencies on aging enter into corporate elder care contracts.

GAO found that: (1) AOA concerns are well-founded but more actions are needed to curb public-mission conflicts; (2) 45 states and the District of Columbia permit corporate elder care contracts with area agencies on aging, and over fifty percent encourage such arrangements; (3) state and area agencies encourage corporate elder care to increase funds to further public-mission objectives, but most state corporate elder care policies conflict and inhibit states' public-mission responsibilities; (4) most states' targeting criteria and methods are inadequate in targeting the elderly with the greatest need; and (5) state policies often do not address protection of public-mission responsibilities, creating gaps in elder care policies that increase the risk of conflicts between private and public objectives.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: Congress amended the state plan requirement of the Older Americans Act to require states to assure that the integrity and public mission of the Older Americans Act programs are maintained and that information regarding contractual and commercial relationships is fully disclosed in state plans (Sec. 307, P.L. 102-375). This process was mostly completed before GAO's report was issued and developed, for the most part, independently of GAO work.

    Matter: Congress may wish to consider amending the Older Americans Act to clarify that AOA has authority to oversee state and area agency on aging activities in corporate elder care partnerships and to define the agencies' responsibilities for ensuring preservation of public-mission objectives when engaged in such activities.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Administration on Aging (AOA), in a letter to GAO on September 11, 1995, stated that the reauthorization language in the Older Americans Act (Sections 306 and 307), passed after GAO's report was issued, satisfied GAO's recommendations. GAO agrees that the language adequately addressed the concerns GAO raised. The language requires that state and area agencies on aging state in their plans officially submitted for funding if they have entered into public/private partnerships, and that they provide assurances in such case that various public mission purposes as described in the law are not compromised. Consistent with the law, AOA states that it has been reviewing such state plans and finds them to be satisfactory in this regard.

    Recommendation: The Commissioner, AOA, should assess which state policy guidelines most need to be strengthened.

    Agency Affected: Department of Health and Human Services: Administration on Aging

  2. Status: Closed - Implemented

    Comments: AOA and the HHS Office of Inspector General reviewed state activities under the Older Americans Act, focusing on stewardship in Title III, the part of the Act addressed in GAO's recommendation. AOA reviewed relationships between the state and area agencies on aging for implementing Title III and the planning process used. After the review, AOA conducted a series of visits to each state capital last year to discuss these issues. AOA discussed federal requirements of the Older Americans Act with state officials, providing states the opportunity to request technical assistance on federal requirements of the act. No state in the initial visit or subsequent followup requested technical assistance on public/private partnerships. AOA stated that it is available to provide such assistance but sees no evidence it is needed at this time. GAO agrees that these actions by AOA address the recommendations satisfactorily.

    Recommendation: The Commissioner, AOA, should provide technical assistance to help state agencies develop corporate elder care policies that better address public-mission responsibilities, especially as regards ensuring the targeting of benefits to socioeconomically disadvantaged persons.

    Agency Affected: Department of Health and Human Services: Administration on Aging


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