Using Medicaid to Cover Services for Elderly Persons in Residential Care Settings: State Policy Maker and Stakeholder Views in Six States. Admission and Retention Requirements


Most respondents felt that their state's admission and retention requirements were appropriate, but many expressed considerable concern about how these requirements worked in practice. With the exception of Texas, people did not have problems with admission requirements. In Texasthere was some concern that current licensing standards are too focused on life and safety distinctions. One person noted that fire and safety regulations have made it possible for facilities to deny residence to people who use wheelchairs. On the other hand, another person noted that the waiver program sometimes pressured facilities to take residents with needs beyond what the facility could provide.

While very few had concerns about admissions, nearly every respondent in every state had concerns related to discharge and agreed that issues related to the ability to age in place were far from settled.

In general, there are two approaches to retention/discharge requirements. One approach sets a maximum, and providers can offer any amount of services up to this limit. Wisconsin uses this approach, allowing CBRFs to provide up to three hours of nursing care per week and RCACs up to 28 hours of care overall, with exceptions for recuperative care.

The other approach sets a minimum, and residential care providers are permitted to set their own ceilings, which allows them to retain residents based on their ability to provide the services needed. Oregon uses this approach, which is less prescriptive, and based on the premise that people should be able to age in place and not be discharged when they reach a specific limit.

However, both approaches recognize that there are circumstances and conditions when nursing home care will be needed. States uniformly require that anyone needing 24-hour-a-day nursing oversight be served only in a nursing home, and some states specifically exclude certain conditions from being cared for in settings other than nursing homes. In Florida, for example, an extended care license permits residential care settings to serve waiver clients, but the statute prohibits them from admitting or retaining persons with specific conditions, such as persons on ventilators.

While most support this latter style of regulation because it permits residents to age in place, they note that it can lead to problems related both to inappropriate retention and inappropriate discharge. A few noted that aging in place policies bring with them liability issues, and this view was supported by others, who noted that with an increasingly older, more impaired and chronically ill population, providers were concerned about lawsuits and increasing premiums for liability insurance.

Even though most respondents felt that retention and discharge problems needed to be addressed, they agreed that rigid discharge requirements were not the solution.

Inappropriate Retention. In all six states, most frequently in North Carolina, inappropriate retention was mentioned as a problem. Inappropriate retention was attributed to residents not wanting to move from familiar surroundings, as well as to providers wanting to retain residents due to low occupancy rates. Several noted that while providers market to healthy, high functioning seniors, there are very few in that category who want to leave their homes to live in a residential care setting, no matter how nice. As one person said, "they can market to the healthy and independent, but the frail show up."

In just one state -- Texas -- a few respondents stated that waiver case managers often pressured facilities to retain a resident, even though rules allowed the facility to discharge based on the resident's condition or behavior. In some states, the reasons mentioned for inappropriate retention were more complex. For example, in North Carolina, there are no residential care settings licensed to care for individuals who need a nursing home level of care. Thus, when residents age and their needs increase, they need to be discharged to a nursing home. However, respondents cited several factors that keep residents in adult care homes past the point where they should be in a nursing home.

A few noted that a major problem in North Carolina is the lack of nursing home beds. Due to a previous moratorium and current CON program for nursing homes, nursing home occupancy rates are quite high. Given high nursing home occupancy rates, some said that it can be very difficult to find a Medicaid bed for a long-term heavy care resident, particularly as facilities often prefer to admit shorter stay Medicare funded residents. Additionally, the state has instituted more stringent nursing home level-of-care criteria for the Medicaid program, making it difficult for some residents whose needs exceed what can be provided in an adult care home from meeting this criteria.

Inappropriate Discharge. Many said that giving discretion to providers to determine when to discharge residents made it easy for them to discharge heavy care or "difficult" clients, even though these residents could be cared for in the community.

Some in Oregon felt that the state was moving away from an aging in place philosophy and was giving providers too much leeway over discharges. They felt that by allowing providers to set their own ceilings, corporate owned ALFs were able to "cream" the lighter care residents. They pointed out that on average, adult foster homes served more severely impaired residents than did ALFs, and that this was true in the state of Washington as well.

On the other hand, some felt that the state was taking a more realistic approach to aging in place, recognizing that individual facilities may have limits on the services they can provide. For example, a small facility that has only one staff person for ten residents can discharge a resident who needs a two-person transfer. Another facility with 20 beds may be able to handle three or four very heavy care residents, but not five or more.

In Minnesota, one respondent said the leading complaint about residential care settings was not lack of care, but "they are making me move." Similarly, in Wisconsin, several noted that a key complaint about RCACs was premature or involuntary discharge and that over half of the residents left because they needed more care than the facility provided. As mentioned previously, Wisconsin sets hourly limits on the amount of care that can be furnished, but providers are free to limit certain types of care, such as nursing, above the minimum required, and to discharge persons who exceed their own established limit.

One person in Wisconsin noted that hours of care is not the only indicator of need, noting that transfer issues cause some people to leave a facility long before they reach the maximum hours. This person also noted even if a facility provided 16 hours of hands-on care a day, it would not address the needs of persons with dementia who could not safely be left in their own unit with a locked door.

Several respondents in different states felt that states need to move away from the idea of aging in place, noting that in order to promote a range of residential care options, facilities needed to be able to market to a particular group. Some providers may want to market to the less frail and others to those with more acute needs. Those supporting this approach stated that people would have to choose a facility knowing they may not be able to stay there forever. However, those advocating this approach stated that to protect the clients and their families, there should be "no surprises down the road" and that full disclosure about the conditions for discharge should be provided before someone entered a facility.

In sum, the concept of aging in place appears to be one that is widely supported. However, even its strongest supporters recognize that many unresolved issues complicate its operationalization, even in states that are strongly committed to the concept, as is Oregon. In general, there was a feeling that aging in place was not working in practice. As one person in Wisconsin noted, the typical service approach is to "fit people into facilities rather than get the facility to match the person's needs."

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