Case Studies of Six State Personal Assistance Service Programs Funded by the Medicaid Personal Care Option. II. Program History

12/01/1991

Prior to 1979, attendant services were funded solely by Title XX funds in Texas. Independent providers were recruited by caseworkers, and these attendants were paid by the state at below the minimum wage. Because Title XX revenues began to diminish, the state decided to include Personal Care in the state Medicaid plan in order to capture the federal match.

This occurred at the same time that the Texas legislature was faced with projected increases in the nursing home population. A report from a Blue Ribbon Panel recommended that the state: (1) Close down custodial care (ICF II) facilities, and (2) expand the number and types of community programs.

In order to facilitate the placement of ICF-II clients in the community, the state received a Medicaid 1115 Waiver. The waiver allowed continued Medicaid eligibility, and therefore access to the federal match, for those nursing home clients who had an ICF II level of care prior to 1980. It also allowed those who met the income criteria for Medicaid reimbursement in a nursing home to be financially eligible for personal care services reimbursed by Medicaid. These clients, as well as clients who met regular Medicaid financial eligibility requirements, became eligible for a new program called Primary Home Care. All ICF II admissions were shipped, and despite some industry prognostication, there was no demand to re-open these nursing homes. The 1115 waiver is running out in June of 1991 (see "Political Future", section VIIIc, below for a discussion on the implications of this loss of funding).

In order to meet the needs of the ICF II population, the state also developed adult day health, emergency response services, and residential care in licensed PC-homes (board and care). They expanded foster care, meals on wheels, and special service programs.

Primary Home Care was designed as a private vendor system, where multiple agencies agree to rates and regulations set by the DHS. This process has led to the development of a fairly cohesive industry lobby, the Texas Association of Home Health Care Agencies. Only agencies with certified home health divisions are allowed to provide personal attendant services. The DHS believes that this arrangement assures that the legal entity has the demonstrated capability to deliver services in the home, and ensures that the consumer has ready access to a skilled care delivery system if s/he needs it. There are currently 180-200 vendors statewide. The system of "open enrollment" contracting allows the client to choose from among the private agencies available in his/her region. The DHS believes that this competitive system encourages service quality.

A uniform reimbursement rate covers services throughout the state. According to DHS administrators, cost differences between rural and urban areas tend to level out. Agencies deliver more units (hours) of service in the big cities and RN supervisors do not need to travel as much to do home visits, which leads to economies of scale (even though they need to pay slightly higher wages). Salaries aren't as high in less populous areas, which offsets the lower volume.

An functional eligibility instrument which assessed limitations in activities of daily living (ADLs) was developed and refined. In order to contain program growth, the ADL score for program eligibility was raised in 1986. State administrators feel that the current level is adequate to separate out those who really need PAS, and are able to defend this to the state legislature. The state also changed the per client service limit from 20 hours to 30 hours per week. According to state administrators, this development did not "lead to a, stampede" for more hours.

Program procedures and regulations were developed and refined, and a compliance monitoring system was developed to evaluate provider agencies. This process of program development continues, and the state is currently looking at mechanisms for providing higher levels of service, emergency services, and paramedical services to consumers.

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