Publication Date

Apr 14, 1983

U.S. Department of Health and Human Services

Implementation and Early Operation of the Channeling Demonstration: Overview

Raymond J. Baxter

Mathematica Policy Research, Inc.

December 1983

This report was prepared under contract #HHS-100-80-0157 between the U.S. Department of Health and Human Services (HHS), Office of Social Services Policy (now the Office of Disability, Aging and Long-Term Care Policy) and Mathematica Policy Research, Inc. For additional information about the study, you may visit the DALTCP home page at http://aspe.hhs.gov/daltcp/home.htm or contact the office at HHS/ASPE/DALTCP, Room 424E, H.H. Humphrey Building, 200 Independence Avenue, SW, Washington, DC 20201. The e-mail address is: webmaster.DALTCP@hhs.gov. The DALTCP Project Officer was Robert Clark.

I. ACKNOWLEDGEMENTS

This overview was prepared by Raymond Baxter from the full report on the initial phases of the channeling demonstration entitled The Planning and Implementation of Channeling: Early Experiences of the National Long Term Care Demonstration. Helpful comments on the overview were made by Robert Applebaum and George Carcagno. Felicity Skidmore provided valuable editorial guidance. Mary Lou Condon and Victoria Dixon prepared the manuscript.

Neither this overview nor the full report would have been possible without the contributions of the people who provided the information on which they rely: the staff of the channeling projects who complete the screening and client tracking forms which are the basis for much of the quantitative data presented in this report, and the channeling project staff at the site and state level, state and local officials, service providers, federal project management team, and national technical assistance staff who generously gave their time, knowledge, and candid opinions in our interviews with them. The authors gratefully acknowledge the contributions of the channeling staff who have implemented the program which this report describes, and the Department of Health and Human Services (DHHS) staff who are responsible for its performance.

II. ABSTRACT

The National Long Term Care Demonstration was established in 1980 by DHHS to evaluate "channeling," a case management approach to organizing community-based long term care for the disabled elderly as an alternative to institutionalization.

Channeling is designed to improve both the targeting of services and resources to those in greatest need and the match of client needs and services (both formal and informal). These, in turn, are expected to lead to better client outcomes and less costly, more efficient utilization of services. Two models of the approach--basic case management and financial control--are being tested, each in five sites. These ten demonstration projects began serving clients in early 1982, and will end operations in late 1984 or early 1985.

Seven core channeling functions are common to all ten channeling projects: outreach, screening, comprehensive assessment, care planning, service arranging, monitoring, and reassessment. To these, the five basic case management model projects add a limited amount of additional "gap-filling" dollars for direct purchase of services. The five financial control model sites enhance the core channeling intervention by expanded service coverage; pooling of Medicare, Medicaid, and other public funding sources; case manager authorization of amount, scope, and duration of service for individuals; a cap on average service expenditures for the caseload as a whole; cost limits on individual care plans; and cost sharing by higher income clients.

All ten channeling projects had implemented the core channeling functions by the first set of evaluation site visits, 3-5 months into project operations. Variations in organizational structure had already emerged, particularly with respect to subcontracting or decentralizing functions. Referral networks had been established with the existing provider agencies most likely to be in contact with the disabled elderly in each community, often through formal written agreements, and the standardized screening procedures had been implemented. Despite unexpectedly low referrals from nursing home-related programs and physicians, the channeling projects had been able to recruit persons meeting the eligibility criteria, largely from hospitals, home health agencies, and referrals from individuals and families. The population screened as eligible was considerably older and more functionally impaired than the national elderly population.

The assessment and care planning process had been implemented according to design. Provider agreements for delivery of service to channeling clients had also been developed; these were more formal in financial control model sites, where competitive bidding was used to award service contracts, than in the basic case management sites. The service arranging and initiating aspects of the care planning process took considerably longer, and were reportedly more difficult, in the basic case management than in the financial control sites, due to problems of accessibility, availability, and control of service authorization. At the time of the site visits, little experience had been gained with the ongoing case management functions, particularly monitoring and reassessment. But there did already appear to be a tendency to rely heavily on different types of formal providers and informal caregivers to monitor one another, as opposed to more direct case manager-initiated monitoring.

The funds pool and care plan cost control had been implemented in the financial control sites through standardized procedures. Though cost control was optional in the basic case management sites, evidence of concern for cost control was found among those case managers as well. Client cost-sharing procedures had limited application at the time of the initial round of site visits, and arrangements for use of gap-filling dollars in the basic case management sites were still being developed.

III. OVERVIEW

The National Long Term Care Demonstration was established in 1980 by DHHS to test the effectiveness of "channeling," a means of organizing community-based long term care for the disabled elderly as an alternative to the current institutionally oriented system. Channeling offers a central point of intake for individuals in need, systematic assessment of their needs, and ongoing case management to arrange and monitor the provision of services. Through contracts with the participating states, local agencies in ten communities around the country were selected to implement the demonstration. The ten channeling projects began serving clients in early 1982, and will conclude operation in late 1984 and early 1985.

The demonstration is being rigorously evaluated, through a randomized treatment/control design, which permits direct comparison of the experiences of persons assigned to channeling with the experiences of otherwise similar persons receiving services through the standard existing delivery system. To evaluate channeling's impact on individuals, a sample of about 4,900 individuals is being followed for 12-18 months after assignment. To evaluate channeling's effectiveness and feasibility as a means of organizing the delivery of long term care, the implementation of channeling, its relation to the existing delivery system, and the characteristics of its clientele are also being documented.

A. The Overview

This overview describes the structure and intent of the demonstration, the characteristics of the channeling projects, the client and system level activities of the projects, and factors that have influenced implementation and early operations. It, and the full report on which it is based,1 thus represents both a status report on the projects in their first year of operation, and a first step toward the full evaluation of channeling's impact and cost-effectiveness.

The information presented is preliminary. As such, it is subject to several important limitations. The data sources covered varying periods, none much more than halfway through the project's startup phase. Most of the qualitative data were obtained in on-site interviews with key participants during the third to fifth month of each project's operations; the quantitative data covered variously the first 7-11 months of projects operations. Features of some of the channeling projects have changed since them; in addition, several important data sources to be used in the final analysis were not yet available. Finally, because individual projects began operations at different points over a five-month period, more data were available on some than on others. This means that comparisons among projects and models should be regarded as particularly tentative, and that data on groups of sites and the demonstration as a whole should also be interpreted with caution.

B. The Channeling Approach

In the past decade long term care has emerged as a central concern to health and social service providers and policy makers. Underlying this is the increasing proportion of the population that is elderly (65 and older), and even faster growth of the population 75 and older.

There now seems to be a general consensus that the major problems of the current long term care system have to do with unmet or inappropriately met service needs, combined with rapidly escalating public costs. A number of alternative solutions have been proposed--including modifications to benefits under existing programs, financing options, and organizational options. Several of these have been, or are now being, tested in national demonstrations; other have taken the form of legislative proposals or been enacted into law.

Channeling was designed principally as an organizational strategy and, in one of two variants being tested, a financing strategy, to achieve the following objectives: improved targeting of service resources to those in greatest need; improved matching of client needs and services (both formal and informal); improved client outcomes; and less costly, more efficient utilization of services. The two variants of channeling as a managed system of long term care being tested are: a basic case management model and a financial control model. Each combines a set of common "core channeling functions" with additional features intended to enhance channeling's ability to intervene effectively in the existing long term care system.

1. Core Channeling Functions

Channeling is intended to affect client outcomes and the cost of care principally by managing individual client utilization of service, particularly through reductions in the use of institutions. To achieve this objective, the designers of channeling prescribed seven essential functions:

Outreach: to identify and attract the target population
Screening: to determine whether an applicant is part of that target population
Comprehensive needs assessment: to determine individual problems, resources, and service needs
Care planning: to specify the types and amounts of care to be provided to meet the identified needs of individuals
Service arrangement: to implement the care plan through both formal and informal providers
Monitoring: to assure that services are provided as planned and modified as necessary
Reassessment: to adjust care plans to changing needs.

Both channeling models incorporate these seven functions. The additional features differ between the two channeling models.

2. The Basic Case Management Model

The basic case management model tests the premise that the major problems in the current long term care system are insufficient information, access, and coordination, which can essentially be solved by client-centered case management. This model depends upon the array of services already available, but introduces an organization responsible for helping clients gain access to and coordinate the services they need to remain in the community. The channeling organization assigns to each client a case manager, who is accountable for planning and arranging the entire package of services needed by the client, and helps negotiate the complex array of existing programs and service providers.

An additional feature of the basic case management model is a limited amount of special service dollars for direct purchase of community-based services, in order to overcome gaps in existing services or funding programs that constitute barriers in the way of appropriate service delivery. Because these gap-filling funds are limited, the case manager still must rely primarily on family and friends, services provided by voluntary agencies, and existing government programs, in developing a plan of care.

3. The Financial Control Model

The financial control model adds six features directed at changing certain aspects of the current long term care system that the basic case management model accepts as given.

Expanded Service Coverage. Funding is extended to some community-based services which may not be reimbursed by government programs or which are unavailable to particular clients in some communities:

Day health and rehabilitative care	Home health aide services
Housekeeping services	Chore services
Home delivered meals	Skilled nursing
Speech therapy	Mental health services
Housing assistance	Nonroutine consumable medical supplies
Day maintenance care	Companion service
Homemaker/personal care services	Physical therapy
Respite care	Transportation service
Occupational therapy	Adaptive and assistive equipment
Adult foster care

Pooling of Government Funds (Funds Pool). The services on the expanded service coverage list typically have to be paid for by a number of separate funding streams. To overcome this, channeling creates a pool of service dollars (drawing on Medicaid, Medicare, and other government programs). From the perspective of the client and case manager, therefore, coverage of the expanded services for any individual channeling client does not depend on eligibility for particular categorical programs.

Authorization Power. For the services paid for from the funds pool, case managers have the power to authorize the amount, duration, and scope for individual clients. This gives case managers direct access to--as well as accountability for--funding of services, and ability to alter services in response to changing client needs or service delivery problems.

Cap on Average Expenditures. A maximum (cap) on average service expenditures per active client for the channeling project's caseload as a whole is set at 60 percent of the average of the state's rates for intermediate care facilities (ICF) and skilled nursing facilities (SNF) in each demonstration area.

Limits on Costs of Individual Care Plans. Under the cap on average expenditures, the cost of individual care plans can vary; but those who exceed the 60 percent cap must be offset by persons whose care is below that percent. Direct limits on annual expenditures for each individual, set at 85 percent of the average of the state's nursing home rates, can be exceeded only with state approval of specific cases.

Cost Sharing by Clients. To focus government financing for the expanded list of community-based services on those clients most in need, individuals with incomes in excess of a protected amount--set at a multiple of the state's Supplemental Security Income eligibility level plus the food stamp bonus amount--are required to share in the cost of their services. They pay all their income above the protected amount (except for services locally available at no charge to the client) up to the cost of services received.

C. Structure of the Demonstration

Implementing a project of the scope and complexity of the National Long Term Care Demonstration requires substantial resources, constant interaction among many actors at the national, state, and local levels, and considerable time. To provide a sense of home these implementation activities have taken place over time, Table 1 lists key events in the two and one half years from the time the demonstration was formally announced to the date all provides had become operational.

1. National Structure of the Demonstration

The National Long Term Care Demonstration is jointly administered within DHHS by the Office of the Assistant Secretary for Planning and Evaluation (ASPE), the Health Care Financing Adminstration (HCFA), and the Administration on Aging (AoA). The national technical assistance contractor, Temple University Institute on Aging, is responsible for development of clinical and administrative guidelines, for training channeling project staff in the core channeling functions, and for seeing that these are carried out consistent with the national demonstration design and standards of clinical practice. Mathematica Policy Research, Inc. (MPR), the national evaluation contractor, is responsible for the research design and analysis of the channeling demonstration; and for all data collection instruments and procedures for the evaluation, whether administered by the channeling projects or by MPR staff.

2. The Channeling Demonstration State Lead Agencies

The ten states designated by DHHS to implement channeling projects as part of the national research and demonstration effort are: Florida, Massachusetts, New York, Ohio, and Pennsylvania to implement the financial control model of channeling; Kentucky, Maine, Maryland, New Jersey and Texas to implement the basic case management model. The governor in each applicant state designated a lead agency for the channeling projects, to be responsible both for coordinating state long term care planning activities, and for contributing to and overseeing implementation of the local channeling projects.

The lead agencies selected for three of the ten states were comprehensive human service agencies--combining public assistance, Medicaid, health, social services, and aging mandates and functions within one administrative entity. Three other state lead agencies were similar to these umbrella agencies in combining the long term care resources of Medicaid and public social services. The remaining four were freestanding departments on aging, responsible for Older Americans Act programs but not for administering the Medicaid or social services block grant programs.

During the planning phase, the state lead agencies were actively engaged in a joint effort with the local host channeling agencies and local channeling staff to establish the projects. After site operations began, the focus of the lead agency's role began shifting to a monitoring function. Respondents in several of the states considered the state long term care planning effort to be as important to the state as the implementation of the channeling project, and in at least four states, statewide long term care program initiatives were reportedly patterned on, or developed concurrently with, the channeling project design.

3. The Channeling Sites and Host Agencies

In contrast to some of the previous long term care demonstrations in which new organizations were created, existing organizations were designated as hosts for the channeling projects. This was intended to facilitate the implementation of channeling by building on the experience and legitimacy of agencies that already had important roles in managing or providing services to elders with long term care needs. The ten sites and host agencies designated to implement channeling are:

Miami, Florida, Miami Jewish Home and Hospital for the Aged.
Eight rural counties in Eastern Kentucky, Department of Social Services, State Department of Human Resources.
York and Cumberland Counties in Maine, Southern Maine Senior Citizens, Inc.
Baltimore, Maryland, City of Baltimore, Council on Aging and Retirement Education/Area Agency on Aging.
Greater Lynn, Massachusetts, Greater Lynn Senior Services, Inc.
Middlesex County, New Jersey, County Department of Human Services.
Rensselaer County, New York, County Department on Aging.
Cuyahoga County, Ohio, Western Reserve Area Agency on Aging.
Philadelphia, Pennsylvania, Philadelphia Corporation on Aging.
Houston, Texas, Texas Research Institute for Mental Sciences.

Four are private, nonprofit corporations, six are public agencies. Three of the public agencies and three of the private host agencies were designated Area Agencies on Aging (AAAs) under the Older Americans Act. The host agencies in two sites are service providers that do not administer public programs, but rather receive funding through the various public reimbursement and direct funding sources. The host agencies in three sites have responsibility for eligibility determination, case management, and service authorization under social services block grant/public social service programs, and one is also responsible for determining eligibility for public assistance and Medicaid.

During the planning phase, the local channeling projects and their host agencies maintained very close operational relationships. After local project staff were hired, host agencies continued to play active roles in interacting with the state lead agencies, working out the details of site operational plans, and assisting the project to develop relationships with referral sources and providers. Host agencies typically treated the channeling projects as component programs of the agency, with channeling project directors being allowed considerable administrative discretion but not considered independent of regular policy and administrative oversight.

D. Organizating the Channeling Projects

The approaches selected by the sponsoring state and local agencies to organize the core channeling functions varied. Major variants involved decisions to subcontract functions to one or more other agencies, to decentralize (out-station) functions to other locations, and to assign separate staff to assessment versus care planning and service arranging. The structures adopted for the channeling projects reflected the interaction of several factors: demonstration guidelines, state policy and program interests, the nature of the local provider and referral systems, management requirements, programmatic concerns, geography of the catchment area, and host agency practices and preferences.

1. Developing Relationships with Referral Sources and Providers of Care

Rather than direct outreach, channeling projects emphasized development of a network of referral sources from among the provider agencies and community organizations most likely to be in contact with the target population. All projects worked to identify potential referral sources, orient them to channeling, and negotiate written agreements with at least some of the priority referral sources, such as hospitals. Although there was considerable variation in the formality and intensity of this process, most projects based their agreements with referral sources on the model developed by the national technical assistance contractor. Channeling projects devoted considerable effort to public information, particularly meetings between channeling staff and a multitude of other agencies, organizations, and community groups.

The mechanisms used to select service providers ranged from formal competitive bidding systems to informal "letters of agreement." The financial control model projects typically employed some form of open bidding process to select providers. One basic case management site also employed competitive bidding to select providers to receive gap-filling funds, but less formal methods were used to select the majority of providers in the basic case management sites. Efforts to identify and engage information supports--such as family, friends, and neighbors--were generally carried out at the case manager level at all sites, with some support and direction at the project level. Efforts to engage volunteer organizations, in contrast, were typically the result of decisions and activities at the project level.

In addition, channeling projects often included both referral sources and providers on channeling agency advisory councils, in some cases building on existing interagency groups or a previous project which had brought providers together in a common effort.

2. Implementation of Gap-Filling Funds in Basic Case Management Model Sites

Each of the basic case management model sites received $250,000 to be used over the duration of the project to fill gaps in the existing service system and stimulate development of low cost alternatives to existing services. In general, gap-filling funds were earmarked to compensate for lack of access to services normally available in the service area--because of wailing lists, pending eligibility, emergencies, or other special limitations. In almost all sites (including financial control sites), respite care, demand-responsive transportation, home delivered meals, and reliable homemaker/personal care were judged to be limited. In many cases long waiting lists or long waiting time for publicly supported services were reported to be limiting access to these services, particularly homemaker and home delivered meals. Clients commonly seen as priorities for services to be paid through gap-filling funds were those in a life- or safety-threatening situation or at immediate risk of institutionalization; those needing, but not eligible for, Medicaid-reimbursable services; and those needing services not Medicaid-reimbursable. Projects had had quite limited experience with gap-filling funds at the time our data were collected; expenditures typically included respite services for informal caregivers, medical or specialized equipment, and chore/home repair services.

3. Implementation of the Funds Pool and the Average Per Client Cap in Financial Control Sites

The funds pool and the average per-client expenditure cap were the two major program components that had to be implemented for financial control channeling projects. As described earlier, the principal intents of the funds pool were to enable case managers to choose services independent of funding source and eligibility, to unite categorical funding streams, and to reinforce interagency collaboration. The cap on average client expenditures combined with the estimated number of active client days for each site for the budget period defined the total projected budget for services. Sixty percent of the total projected funds pool budget for core services is underwritten by HCFA through Medicare (Section 222) waivers. The remaining 40 percent of the funds comes from sources administered by state and local government, primarily state Medicaid programs.

The procedure used at the time of our interviews was as follows: drawing on the funds pool, each of the financial control projects followed standardized procedures for provider reimbursement. Contracted providers invoiced at least monthly and their bills were checked against service orders issued by the case managers. A report generated by a semi-automated financial control system (FCS) was used for this verification. Once verified and approved, provider invoices were forwarded to the fiscal unit (generally in the host agency), were actual payments to the providers were issued. The primary function of the FCS was to ensure that obligations of funds for client services did not exceed the cap on average per client expenditures. Because service funds were obligated through the actions of a number of individual case managers making clinical decisions about the most appropriate ways to meet client needs--rather than through a single controller or fiscal manager--the FCS required data on care plans, cost calculations, and service expenditures for individual clients. This was in order to produce a set of reports used to manage the agency budget not only at the project level but at the case manager and client level as well.

E. Casefinding and Screening

Development and implementation of strict entrance criteria to identify elderly individuals at high risk (those who "but for channeling" would be in an institution) received considerable effort.

1. Targeting

Several factors associated with risk of institutionalization were combined with specific program criteria (such as geographic boundaries of the catchment area and age), to form the standard eligibility criteria for the demonstration (see Table 2). A screening process was used to minimize the cost associated with using a comprehensive in-person assessment as the basis for determining appropriateness for channeling. A standard screening instrument encompassing the eligibility criteria was designed, and each channeling project established a unit to screen prospective participants.

Applicants came to the attention of the screening unit primarily in two ways: elderly individuals (or family, friends, or other persons acting on their behalf) contacted the screening unit directly; or formal provider organizations made a referral. Each project followed the standard screening procedure which involved administering the screening instrument by telephone.2 Screeners conducted the interview with potential clients where possible, but could also accept reports from formal referral sources, families, friends, or other proxies.

Immediately following the screen, which averaged 15-20 minutes, the screener made a determination of the person's eligibility for channeling. For any applicants meeting the eligibility criteria, the screener then called the evaluation contractor daily for random assignment to the channeling treatment group or to the control group. Based on the random assignment decision (communicated within 24 hours), screeners called applicants (and in most cases their referral sources) to tell them whether they had been accepted as clients. Those determined ineligible or assigned to the control group were referred back to the original referral source or, in the case of self and family referrals, to the local information and referral (I&R) agency. Eligible clients were assigned to the project's assessment staff and members of the control group to MPR for baseline interviews. Figure 1 outlines the client flow process from referral to assignment to receipt of case management services.

2. Results of the Targeting Effort

Channeling projects recorded receiving eligible referrals from over 20 types of referral sources. These ranged from medical equipment rental suppliers, out of town relative and clergy, to more traditional health and human services providers such as hospitals and local social service agencies. Although there was considerable variation among the individual channeling projects, patterns by category of referral source emerge when the sites are considered together. For a sample of 3,035 individuals determined eligible for the project from inception of the demonstration through December 1982 (ranging from slightly over ten months for projects that started intake in late February 1982, to under seven months for those beginning operations in June 1982), the highest ranked sources of eligible referrals were, respectively, family/friends/self (27.9 percent), hospitals (21.4 percent), and home health agencies (15.2 percent). The lowest ranked were information and referral agencies (3.9 percent), nursing home-related sources (2.9 percent) and channeling outreach (0.8 percent).

Actual ages of eligibles ranged from 643-103 years, with a mean age of 79.6 years. Compared with the national aged (65 and over) population, this channeling sample was a much older group: 8.8 percent of the national aged population is 85 and over, compared to 27.6 percent of the channeling sample.

Impairment in activities of daily living (ADL)--bathing, dressing, toileting, transfer, continence, and eating--was used as the primary determinant of functional disability. Measured in this way, 72.6 percent of the channeling sample was severely or very severely impaired (two or more severe ADL impairments); an additional 21.1 percent of the sample was classified as moderately impaired (at least two moderate or one severe); and 6.3 percent was classified in the mild range (zero or one moderate). For a portion of the moderate ADL impairment group, and all the mildly impaired group, there was an additional qualification requirement based on severe impairments in instrumental activities of daily living (IADL)--meal preparation, housekeeping, shopping, travel, taking medicine, managing finances, and using the telephone. Of this group, 98.4 percent reported severe impairments in two or more IADL categories (the 7 IADLs were collapsed into 4 categories for eligibility purposes), including cognitive or behavioral impairment category for eligibility purposes, and was reported for 51.3 percent of the full sample).

This channeling sample was significantly more impaired than the national aged population in performing bathing, dressing, and toileting functions. Only 32 percent of the channeling sample was reported independent in dressing, 44 percent in toileting, and 10.5 percent in bathing--compared to 97, 98.4, and 95.7 percent, respectively, of the national aged population.

In addition to the impairment criteria, channeling eligibility also required documentation of unmet needs for services expected to last at least six months. Eligibles reported an average of three unmet service needs expected to last for at least six months. Of the full sample, 32.4 percent reported more than four unmet needs, and an additional 60.4 percent reported unmet needs in two or three areas. The remaining 7.2 percent qualified for channeling because their support system was judged too fragile to meet their needs on a continuing basis. In all, 86 percent of eligibles were reported to have fragile informal support systems.

With respect to insurance coverage, 98.4 percent of the channeling sample reported coverage either under Medicare, or Medicare plus other coverage such as private insurance or Medicaid. In all, 24.4 percent of the channeling sample were covered by Medicaid, compared with 13.8 percent of the nation's aged population (which includes those currently institutionalized).

Of the channeling sample, 33.9 percent lived alone in the community, compared to 27.5 percent of the aged population nationally; 70.8 percent were female, above the 59.6 percent figure for the national aged, but not unexpected given longevity patterns and the high number of those over 85 in the channeling sample. Screen data showed that 21.3 percent of channeling eligibles were black and 3.9 percent Hispanic; nationally, 8.1 percent of the aged are black and 2.7 percent are Hispanic.

With respect to income, 60.4 percent of the channeling sample reported incomes of less than $500 per month; an additional 33.2 percent reported monthly incomes between $500 and $999.

F. Initiating and Managing Services for Channeling Clients

For the targeting population described above, the principal functions of channeling were to plan, initiate, and manage an array of needed services. These core channeling activities included assessment, care planning, arranging services, and ongoing case management.

1. Baseline Assessment

Channeling emphasized a comprehensive individual assessment process encompassing social, health, and other areas of need, conducted in person and documented through a standardized written instrument. The assessment instrument developed for the demonstration was administered to channeling clients by clinically trained case managers, relying primarily on client self-report. Staff at each project received standardized training on the assessment instrument and process from the national technical assistance contractor.

Each case that was screened, determined eligible, and assigned to the channeling treatment group, was assigned an assessor or case manager to schedule and conduct the baseline assessment; demonstration guidelines called for completing the assessment within seven working days after assignment.

At the outset of the interview, assessors explained the nature of the demonstration, and clients (and, when necessary, family members or guardians) were asked to sign an informed consent document, agreeing to participate in the demonstration and to release information for research and clinical purposes. Assessors then completed the baseline assessment instrument, which averaged one hour and 15 minutes. Assessments were usually completed in one visit, generally in the home of the client or proxy but sometimes in hospital and nursing homes. After assessment, staff checked the eligibility criteria--the same as in initial screening--to confirm program eligibility, and initiated the care planning process.

2. Care Planning

Following review of the assessment information, most case managers contacted informal caregivers, physicians, or formal provider agencies currently (or recently) involved with clients, to inform them of the case manager's role and to discuss particular needs of clients. Case managers then began writing the care plan. The standard care plan format (with minor site-specific variations) included client problems, expected outcomes, types of help or service needed, specific provider, and pattern of delivery. The initial care plan was usually designed for a three-month period, after which the client would be reassessed and the care plan modified accordingly.

The next stage of care planning--the selection of service providers--differed between the basic case management and the financial control projects. Basic case management projects (only one of which had begun to use gap-filling expansion funds in this early period) frequently reported problems with the availability of selected services and in some cases had to consult several providers before finding services, particularly homemakers or personal care, necessary to complete the care plan. In the financial control projects, service-specific contracts with major providers made service availability, client access, and provider selection much less of an issue, particularly when services were in short supply.

Working with informal providers was considered especially time-consuming and difficult, but channeling staff did report incorporating them in many care plans: family members were typically used for companionship, meal preparation, and personal care functions; nonfamily for things like visiting, shopping, and transportation.

After the case manager identified which services were needed and the sources of care (informal and formal), the cost of the care plan was estimated. Using a standard cost calculation worksheet, the financial control projects compared these estimated costs to the cost limits described earlier. In the basic case management projects the cost calculation component was not as extensive, and use of the standard worksheet was optional. However, case managers and supervisors in all sites reported a strong emphasis on cost control, although they felt that completion of the cost calculation worksheets was burdensome. Basic case management projects, whose care plans were not formally constrained by cost controls, felt that keeping care plan costs below nursing home rates was not difficult (primarily because of limited service access and availability). Although financial control model projects operated under formal cost limits, only one reported that the cap was really constraining care planning decisions.

Calculation of client cost-sharing contributions was also performed at this stage. As noted, basic case management projects had not yet implemented cost-sharing procedures for gap-filling funds at the time of our visits. Financial control project staff attributed limited application of the cost-sharing requirements to two factors: the services for which no cost sharing was required tended to include a large number of the services most frequently ordered by channeling; and the majority of their clients had relatively low incomes. In general, case managers felt that the cost-sharing requirements were not affecting participation.

Following provider selection, supervisory review, and approval, case managers arranged for a written sign-off on care plans from clients and/or their families explaining to the client and the family what channeling was going to do, and what was expected of the family. Project staff described this step as an important departure from conventional practice.

3. Initiating Services

In general, after care plan sign-off, case managers began the service ordering process. In the basic case management sites there was typically at least informal negotiation with potential providers during the early phases of care planning, to avoid promising services that could not subsequently be delivered. In the financial control sites, this preliminary contact was much less common, since providers were under direct contract to the channeling agency.

In the basic case management sites the service ordering process involved negotiation and "brokering" among the client, the case manager, and the provider. Case managers could recommend the amount, type, and duration of the services ordered. But the decision on these--as well as whether to provide services at all--was at the discretion of the provider, and subject to prevailing program eligibility criteria.

In the financial control sites the service ordering process was quite different, particularly for the non-health-related services. Their contracts for services made access and availability much less of an issue than for basic case management models, and enabled them to specify providers, units, and schedules. One exception to this--despite the formal contracts--was home health providers, whose extensive experience and medical orientation often made agreement between the two a necessary condition for the ordering of skilled care.

After ordering services for the client--usually confirmed via a written service order--case managers confirmed that service was actually initiated. This was done most often through telephone calls with providers, clients, or families.

4. Ongoing Case Management

Once the initial care plan was implemented, each case manager was responsible for ongoing monitoring of the client, in order to maintain a high quality of service on a continual basis and to adapt services to changes in clients' social and physical condition. Formal reassessments are required at specified intervals, and most case managers reported engaging in frequent contact. In general, they reported that this was more time consuming than expected, because of the frailty of clients and the unreliability of some service providers. The majority of these contacts appeared to be initiated by clients or informal caregivers to discuss problems of service delivery or needs that were not being met, and case managers relied on these as their primary means of monitoring providers. Case managers also depended to varying degrees on providers' reports. They reported relying on staff who had day-to-day contact with their clients--such as those delivering meals or providing personal care--to monitor changes in client needs, and in turn, on skilled providers--such as nurses--to monitor service provision by the nonskilled providers. The boundary between monitoring clients and monitoring providers was, therefore, somewhat blurred in practice.

G. Caseload Development and Elapsed Time

Project staff consistently suggested that case management functions would be implemented differently after the caseload buildup period was completed. Two major factors were identified as influencing channeling's ability to recruit and serve the at-risk target population: the rate of caseload buildup, and the time required to complete the major steps in the channeling process. These issues are closely linked. Referral sources and providers frequently commented on the time required for assessment, care planning, and service initiation, and cited this as one factor influencing referrals. Similarly, the priority given to building and maintaining the caseload was frequently cited by channeling staff as causing uneven or burdensome workloads, backlogs at screen or assessment, lengthy elapsed time, and insufficient time to devote to working with informal caregivers and to ongoing monitoring of clients.

1. Caseload Development

By February 28, 1983, 2,835 clients had been assigned to the ten channeling sites. Most of the basic case management projects began operations approximately 2-3 months prior to the financial control projects, but because caseload buildup proceeded faster in the financial control projects, slightly more cases were enrolled in the financial control model (1,457 compared to 1,378 for the basic case management model).

As persons were assigned to channeling for assessment, care planning, and service initiation, some clients dropped out because they decided not to participate, were determined not to meet the eligibility criteria, or experienced changes in their conditions or circumstances. Other persons dropped out or were inactivated following initiation of services for a variety of reasons. These events affected the activities of channeling staff as well as the size of their active caseloads. Of the cohort of 1,077 individuals who had entered channeling by August 31, 1982, 60.4 percent were active four months later (31 clients in this latter group had been inactivate or terminated and then reactivated). In addition, 5.8 percent (62 individuals) were inactive at the end of four months. The major reason for individuals being inactivated--a temporary status from which persons had to be reactivated or terminated within three months--involved placement in institutional settings.

The majority of clients not receiving project services after four months had been terminated from the program 33.8 percent of those assigned to receive services). The major reasons included refusal to participate (10.8 percent), death (9.9 percent), institutionalization (4.9 percent), and insufficient disability (3.8 percent). Reasons for termination did vary by model, with basic case management projects having a significantly higher proportion of refusals (13.2 percent) than the financial control projects (7.1 percent). For the sample members terminating before completing an assessment (21 percent of the full cohort), client refusal to participate in the demonstration was the major reason. For those terminating during the care planning process (4.7 percent of total sample cohort) refusal to participate, death, and institutionalization were the predominant reasons for termination. For those terminating after care plan sign-off and service initiation (8.1 percent of full cohort), death and institutionalization became the major reasons for termination, with the proportion of refusals dropping.

As of the end of February 1983, active caseloads for the ten projects ranged from 74-301, with an average of 162. The active caseload of each channeling project at any given time was the result of several factors: the volume of referrals, the number of applicants determined eligible at the screening, the number assigned to the channeling treatment group, and subsequent inactivations and terminations. The way in which these factors came into play determined the workload of channeling staff performing the functions at each stage of the channeling process. This in turn affected the time required to complete each of these steps which, in its own turn, then influenced the rate of buildup a project could accommodate.

2. Elapsed Time Between Functions

Clients averaged 30.2 (median 24) days from the point of assignment to initiation of first service. The periods from referral to screening, and screening to assignment, had mean times of 1.1 and 1.7 days, respectively, accounting for a small proportion of the total elapsed time. Completing the assessment (mean time of 7.3 days) and care planning (mean time of 19.8 days) processes were the functions requiring the longer time. The mean number of days from care plan sign-off to service initiation was 4.2 days.

The elapsed time between functions varied significantly between models. The major difference in these elapsed times occurred during the care planning phase, with basic case management projects averaging 23.4 days from assessment to care plan sign-off, compared to 15.5 days for financial control projects. This finding is consistent with reports by case managers in the basic case management projects (noted earlier) about the difficulties they encountered in identifying and finding services for their clients.

Because most programs providing care for the elderly do not calculate this type of elapsed time information, the channeling experience cannot be systematically compared to that of existing programs in the long term care system. In assessing the elapsed time, it may also be relevant to distinguish the provision of post-acute services from a broader, long-term approach to community care. Channeling's comprehensive screening, assessment, and care planning process was intended to develop a basis for serving the chronically impaired elderly over an extended period of time; and each of these steps required considerable case manager, client, and family involvement. The emphasis on rapid caseload development during the early months of program operations may also have been a contributing factor.

H. Factors Influencing the Implementation and Early Operations of Channeling

The channeling sites were a self-selected sample of communities across the country interested in long term care. That they were able to implement channeling may indicate that the conditions conducive to implementation were already at work in those particular communities; it is less clear whether such conditions can be created deliberately in other environments.

Respondents identified a wide range of factors that facilitated or constrained the planning and start-up of channeling operations. The two facilitating factors most frequently cited were support at the state level, and support from the local provider community. The next most frequently cited factors, in order, were the presence of a strong lead individual and capable staff in the channeling agency itself, the existence of a previous long term care project in the community, the responsiveness of channeling to community need, and good local planning. The major constraints identified fell into three broad categories: design of the demonstration itself (including research requirements) and the kind of responsibilities it imposes upon a service delivery system; the behavior of extracommunity actors (namely, the federal government and the national contractors) and the kinds of limits that they place upon local options and freedom of action; and the effect of turf issues and provider concern on the ability of the channeling demonstration to operate in the local community.

In a national demonstration that brings additional resources and attention to a state or a community, and for which major actors applied to participate, there is an inherent incentive to implement the program. To do this successfully, however, without alienating necessary participants, involves compromises. In the course of channeling's implementation and early operations, three areas important to the eventual success of channeling appear to have been affected by implementation compromises: identifying and recruiting an impaired elderly population at risk of institutionalization; planning care and arranging services; and managing the provision of care.

1. Target Population

A fundamental concern was channeling's ability to identify and recruit the planned target population. Referral sources generally understood the channeling eligibility criteria, but within those parameters sometimes differed on whom they would refer, and when. A few sources referred only persons with no informal supports; some others assumed that persons with no informal caregivers were not likely to remain in the community in any case and did not refer them to channeling. Some did not refer clients until they had run out of benefits or need for that agency's service; others made referrals in anticipation that they could continue serving the client under channeling's auspices. In a few instances, clients needing very heavy care were reportedly not referred because channeling was seen as lacking capacity for skilled service, because the cost of their care might exceed the channeling expenditures cap, or because the clients might be required to share in the cost of services. In many cases clients were reportedly referred by providers because services they needed were not available except through channeling funds--either the gap-filling funds of the basic case management projects or the funds pool of the financial control projects.

The case mix may also have reflected the way the screening process was implemented. A few respondents felt that the eligibility criteria and the nature of the screening instrument (including its reliance on self-reported information) tended to exclude some persons who had mental impairments, who lived alone without assistance in daily activities, or who overemphasized their independence in order to qualify for community care and leave institutions. Some felt that the strict disability criteria and the requirements for expected unmet needs for a six-month period excluded persons who could benefit from channeling.

Reservations about a control group, and about the time required for channeling to initiate services, were also cited as factors influencing referrals to channeling, particularly for persons whom referral sources believed needed prompt services (especially those being discharged from hospitals). For these reasons, referrals were often made to both channeling and a provider agency simultaneously.

Referral patterns may also have reflected the choices channeling projects made in targeting formal referral sources and conducting outreach. Emphasis on recruiting applicants from the health care sector resulted in a steady and important flow of referrals from hospital and home health agencies, and home health agencies emerged as intermediaries in this process. Often persons were discharged from hospitals to home health agencies providing post-acute skilled care services under Medicare, and were subsequently referred to channeling as benefits were exhausted and/or skilled care needs diminished. Referrals from physicians and nursing home-related sources, despite considerable effort by channeling in the latter case, were uniformly low; reasons for this will be examined as the projects continue operations.

Thus, the early data suggest that the channeling projects were successful in developing referral sources and implementing screening procedures that enabled them to locate and recruit a disabled elderly population. The extent to which this was in fact a population likely to be institutionalized in the absence of channeling will be determined through comparison of the experiences of the treatment and control groups as the demonstration continues.

2. Care Planning and Service Selection

Development and implementation of care plans for channeling clients appear to have been influenced by a number of factors. The ability of a case manager to design a specific care plan depends upon the information and the services available. Assessors reported that the standardized comprehensive in-person assessment provided them with useful information on which to base care plans, despite some concern about its length, structure, or the reliability of self-reported information.

The time and effort required to complete the assessment and care planning processes were attributed in large part to the standardized forms and procedures required by demonstration guidelines, and to the rapid pace of intake required during the caseload buildup period; availability and accessibility of formal and informal providers of care were also mentioned as factors. Some basic case management projects lacked access to services that case managers thought appropriate and, because gap-filling funds were not yet available, had to develop alternatives in order to establish a care plan. In financial control projects, the case manager's flexibility was sometimes limited by agency contracts with a small set of providers, resulting either from limited supply or from the fact that a particular project was compelled to contract with the low bidder. Referral sources making a dual referral to both a direct service provider and channeling, and the desire of both clients and agencies not to disrupt existing service arrangements for individuals in some cases, also appear to have imposed constraints on case managers' design of the care plan and selection of providers.

Care planning also appears to have been influenced by the presence or absence of informal caregivers. Availability of informal caregivers is a function of demographics, culture, and the orientation of case managers toward this source of care. Many case managers reported families were "burned out" when they turned to channeling, making it a time-consuming process to incorporate them into the care plan, particularly to increase or alter their role. Pressure on case managers to build up the caseload during this early period also reportedly detracted from involving informal caregivers.

It is clear that in the basic case management sites, and in some instances the financial control sites, negotiating services was a significant element of the channeling process. As a result, the care plan reflected the compromise of implementation at the particular site rather than the ideal set of appropriate services to meet particular needs. Home health agencies emerged as influential sources of many services channeling clients need, in both basic and financial control sites; and considerable effort was devoted to negotiating with them over the amount and type of clients services, defining the respective roles of case managers and home health agency staff in managing and monitoring care.

Care planning was shaped further by cost considerations. In the basic case management sites, where cost was not a formal limiting factor, case managers indicated that they were aware of rates for services and often took this into account in formulating care plans. In the financial control sites, where the estimation of the cost of service package was required, case managers and supervisors reported considerable attention to staying within the formal cap. Staff in some sites reported encouraging clients and families to pay for services; others indicated that they preferred to use inexpensive providers or a less expensive or intensive form of a desired service to keep within the cap. There was some limited evidence that, as a result of requirements for cost sharing, the service plan might be varied so as to use services for which cost sharing was not required. Concerns about the cost and quality of service available also influenced care planning decisions, particularly in choices between nonprofit and proprietary homemaker agencies. The care plan, therefore, to some degree reflected a series of compromises with both the existing service system and the design features of each channeling model.

3. Ongoing Case Management

Lack of time to carry out active monitoring of clients was identified as a major concern during early operations. Pressures for caseload buildup, and the associated initial assessment and care planning activities were seen as imposing strict limitations on the amount of time that could be devoted to ongoing case management. As a result, care managers reported relying heavily in most instances on monitoring clients through contacts initiated by providers in day-to-day contact with clients (homemakers, personal care aides), and by clients, families, and informal caregivers. Similarly, monitoring of providers was accomplished through both clients and families, supplemented in many cases by skilled care providers monitoring other caregivers.

Viewing all this within and across sites and models provides perspective on the circumstances that shaped the early implementation of channeling. Some of these influences were grounded in the environments of the channeling projects: the demographics and geography of the area, the public programs and services that existed there, the nature of provider and referral source networks, the position and auspices of the state lead agency and local host agency. Others were specific to the national design and structure of the demonstration. Still others stemmed from the design, structure, and staffing of the individual projects. Clearly the different influences interacted to a considerable degree.

It is this interaction of channeling, its environment, and its role in a national research demonstration effort that will ultimately determine impacts on costs and clients. For the final report, the impact of these factors on the projects in their mature state will be described and examined in conjunction with channeling's outcomes, to provide a more definitive statement of the factors affecting successful implementation and operation of a community service program like channeling.

NOTES

See Raymond J. Baxter, et al., The Planning and Implementation of Channeling: Early Experiences of the National Long Term Care Demonstration. Princeton, New Jersey: Mathematica Policy Research, Inc., April 15, 1983.
In a few instances in-person screening was required, e.g., when applicants were institutionalized, had hearing impairments, or had no access to a telephone.
In three instances, apparently due to arithmetic errors in calculating age from birthdate, 64-year-olds were admitted to the program.

TABLE 1: MILESTONES IN THE PLANNING AND IMPLEMENTATION OF THE CHANNELING PROJECTS
Date	Event
December 1979	DHHS publishes notice of intent in the *Federal Register* to develop a coordinated long term care channeling demonstration.
April 1980	DHHS issues request for proposals for channeling states.
May 1980	DHHS issues requests for proposals for the national technical assistance contractor and the national evaluation contractor.
June 1980	States and technical assistance and evaluation bidders submit proposals.
September 1980	DHHS selects 12 channeling demonstration states, and the national technical assistance and evaluation contractors.
November 1980	Demonstration states submit site proposals.
January 1981	DHHS selects 12 channeling project sites.
June 1981	DHHS issues guidelines for channeling states wishing to implement the financial control model.
July 1981	States submit financial control model letters of intent.
August 1981	DHHS reduces from 12 to 10 the number of national research states and sites.
September 1981	DHHS designates 5 financial control projects, the other 5 as basic case management projects.
December 1981	Channeling projects submit detailed operational plans to DHHS.
February 1982	First of the basic case management projects begin operations after hiring staff; going through screening, assessment and case management training; negotiating referral agreements with priority referral sources; and implementing internal management information and record keeping systems.
May 1982	First of the financial control model projects begin operations after completing same tasks as basic case management projects, as well as negotiating provider contracts, implementing the financial control system, and completing funds pool arrangements.
June 1982	All projects were operational.

TABLE 2: NATIONAL LONG TERM CARE CHANNELING DEMONSTRATION PROGRAM ELIGIBILITY CRITERIA
-	Explanation of Criterion
Age	Must be 65 or over.
Residence	Must reside within project catchment area; must be living in community or (if institutionalized) certified as likely to be discharged within three months.
Functional Disability	Must have at least two moderate ADL disabilities, or three severe IADL impairments, or two IADL impairments and one severe ADL disability. a
Unmet Needs or Fragile Informal Support	Must need help with at least two categories of service affected by functional impairments for six months (meals, housework/shopping, medications, medical treatments at home, personal care), or have a fragile informal support system that may no longer be able to provide needed care.
Insurance Coverage	Must be Medicare Part A eligible (for the Financial Control Model).
The six ADLs include bathing, dressing, toileting, transfer, continence, and eating. The seven IADLs are housekeeping, shopping, meal preparation, taking medicine, travel, using the telephone, and managing finances. For the purpose of the IADL eligibility criterion, the first two and the last three IADLs were aggregated into two combined categories. Thus there are four possible IADL areas under which applicants can qualify, plus the cognitive/behavioral impairment category which counts as one IADL item.

Topics

Long-Term Care Financing

The Planning and Implementation of Channeling: Early Experiences of the National Long Term Care Demonstration