Analysis of the California In-Home Supportive Services (IHSS) Plus Waiver Demonstration Program. Implications for Medicaid and IHSS Expenditures

07/01/2008

For all recipient age groups, IHSS expenditures, adjusting impairment severity and service needs, are expected to be lower relative to those with Non-Relative providers when Parents, Spouses, and Other Relatives living in the household are paid IHSS providers. This cost difference arises because an IHSS algorithm adjusts the authorized time for housekeeping/meal preparation when there are relatives living in the household who might be expected to perform these tasks for themselves as well as for the recipient. This adjusted cost difference was observed for Parent providers to minor children, and for Spouse providers of adults. The cost differences for Parent provider (non-aged adults) and Other Relative providers were minor or non-significant. This could be because these providers were not living with the recipient or they may reflect limitations in the risk adjustment model.

Minor children with Parent IHSS-paid providers, adjusting for recipient functional and health conditions, have lower average monthly Medicaid expenditures, and lower IHSS and other home care expenditures than recipients with Non-Relative providers.

Adjusting for recipient characteristics, recipients age 18-64 with Spouse providers had lower average Medicaid monthly expenditures than those with Non-Relative providers. There were no statistically significant differences comparing recipients with Parent and Non-Relative providers. Among these adult IHSS recipients each of the paid relative provider groups had a significantly reduced likelihood of nursing home placement compared to those with Non-Relative providers. The Parent provider effect for those age18-64 appears greatest. Those with Spouse providers tended to have higher risk of “any cause” hospital stays (but not those associated with ambulatory sensitive conditions), higher risk of ER use, but lower IHSS and home care expenditures than recipients with Non-Relative providers. Recipients with Parent providers compared to those with Non-Relative providers had lower adjusted use of hospitals, ERs, and home care.

Average monthly Medicaid expenditures among recipients age 65 or more, adjusting for recipient characteristics, were lower for those with paid Spouse providers and Other Relative providers compared to those with Non-Relative providers. This tendency for lower risk among those with family providers (both legally responsible and otherwise) was also present with respect to ambulatory sensitive hospital stays; and those with Other Relative providers compared to those with Non-Relative providers had reduced risk of ER use, lower monthly expenditures for IHSS and other home care.

In short, these analyses found no financial disadvantage and some advantages to Medicaid from allowing spouses, parents (and other relatives) to be paid IHSS providers. This argues in favor of honoring the recipient’s and family’s preference for such providers. Whether the availability of spouse, parent, and other relatives can be expanded beyond its current proportion among all race/ethnic groups in IHSS is unknown, but changes in the race/ethnic mix of recipients evident in the new cohort of enrollees may affect this. The proportion of recipients who are Hispanic or Asian seems to be growing. These groups presently have the highest proportionate use of Spouse, Parent, and Other Relative providers.

These effects of selecting Parent, Spouse, and Other Relatives as paid providers are present within a program where the rate of Medicaid nursing home stays among IHSS recipients with Non-Relative providers seems to be low. This suggests that IHSS in general is doing a good job of enabling recipients to remain in the community regardless of the provider type selected. Not examined in this analysis were the factors (such as hospital stays, avoidable changes is health or functional status) associated with entry into and exit from IHSS; or the duration of participation in IHSS and the cost/use comparisons over time.

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