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

Historically, personal care facilities (sometimes called personal care homes) and adult foster care were the primary residential care options in Texas. In 1999, personal care facilities were renamed assisted living facilities, which are defined as any facility that serves four or more adults who are unrelated to the proprietor. Adult Foster Care homes that serve four or more persons are also required to be licensed as an assisted living facility.

In the mid-1990's, the state became interested in supporting residential care alternatives to nursing homes for individuals who met a nursing home level of care but could not be safely cared for at home. The Department of Human Services worked with providers and advocates to develop a 1915(c) waiver program to provide services in both private homes and residential care settings. The new waiver program, called Community Based Alternatives (CBA), was implemented in 1994. Initially, the cost of CBA waiver services was capped at 90 percent of nursing home cost, but the state has now raised the cap to 100 percent.

The primary goal of the CBA waiver program is to offer home and community alternatives to institutional care and to provide the opportunity for those in institutions to transition to the community. In keeping with this goal, the state made efforts to bring about a "culture change" among hospital discharge planners, doctors and families regarding the appropriateness of home and community care alternatives to nursing homes. One respondent noted that these efforts appear to have been successful, given that 95 percent of those receiving CBA waiver services have never been in a nursing facility.

When the CBA waiver program was developed, it was anticipated that 50 percent of waiver clients would be served in personal care facilities, particularly elderly persons who did not need a high level of care. This expectation fueled the development--and some respondents said--the over-development of personal care facilities and other types of residential care settings.

In 1987, Texas had 4,200 beds in personal care facilities. In 2002 there were over 40,000 licensed assisted living beds (including adult foster care homes licensed as Type C assisted living facilities), of which only 67 percent (26,000) were occupied, primarily by private pay residents. The main reason for the low occupancy is that the majority of waiver clients choose to live in their own homes. In 2002, approximately 2,500 CBA waiver clients received services in assisted living facilities through 320 contracts with providers across the state--less than seven percent of the 32,000 clients receiving CBA waiver services.

• Adult Foster Care Homes provide a 24-hour living arrangement with supervision for individuals 18 years of age and older who, because of physical or mental limitations, are unable to continue independent functioning in their own homes.

• Providers may serve up to three adult clients in a Department of Human Services (DHS) enrolled adult foster home. These homes do not have to be licensed but those accepting Medicaid clients have to meet Medicaid contracting requirements. Homes with four or more residents are called Small Group Homes and must be licensed under the assisted living licensing rules as a Type C facility, in addition to being enrolled with DHS. Providers must serve no more than eight adult clients in an enrolled Small Group Home. The CBA waiver program contracts with both licensed and unlicensed adult foster care homes.

• Services reimbursed through the CBA waiver include meal preparation, housekeeping, personal care and nursing tasks, supervision, and the provision or arrangement of transportation. Nursing tasks may be delegated by a registered nurse to a foster care provider based on the provider's abilities and the needs of the participant.

• The client pays the provider for room and board from their own income. Texas limits the amount that can be charged for room and board for Medicaid waiver clients in adult foster care to an amount equal to the SSI federal benefit rate minus a personal needs allowance of $85.00 which equals $467. There are no restrictions on the amount adult foster care homes can charge private pay residents.

• CBA waiver clients can be served in private or shared rooms depending on availability and the preference of the client. Adult foster care homes cannot have more than two beds in any room and must provide at least 80 square feet of floor space in a single occupancy room, and at least 60 square feet of floor space per client in a double occupancy room.

• There are three care levels in adult foster care homes, and as of September 2003, the payment rates are $18.71, $32.27 and $65.52 per day. The level of care required is based on an assessment and the recommendations of a Home and Community Support Services nurse.

• Adult foster care providers cannot terminate services to a resident without the prior approval of the adult foster care caseworker or supervisor, unless the resident creates a serious or immediate threat to the health, safety, or welfare of the provider or the other residents of the foster home.

In Texas, assisted living is a service delivery model not an architectural model. It is defined as a housing plus services arrangement for persons who, because of a physical or mental limitation, are unable to live their own homes. Assisted living settings provide food, shelter and personal care services to four or more persons who are unrelated to the proprietor of the establishment.

There are five types of licensed ALFs, but there are two primary licensing designations, which are based on residents' physical and mental ability to evacuate the facility in an emergency, and whether nighttime attendance is necessary.⁸ They are:

• Type A facilities, whose residents must be capable of evacuating the facility unassisted, who must not require routine attendance during night time hours, and who must be capable of following directions under emergency conditions. This may include persons who are non-ambulatory but mobile, such as persons in wheelchairs or who use electric carts, and have the capacity to transfer and evacuate themselves in an emergency.

• Type B facilities, whose residents may require staff assistance to evacuate, may not be able to follow directions, who require attendance during the night, and who, while not permanently bedfast, may require assistance in transferring to and from a wheelchair. Facilities that advertise, market, or otherwise promote their capacity to provide personal care services for people with dementia must be certified as a Type B facility.⁹

Only licensed facilities may use the term assisted living, and the statute requires careful monitoring to detect and report unlicensed facilities. An assisted living facility must be licensed to participate in the CBA waiver program.

8. Type C facilities are Adult Foster Care Homes with four or more beds. In 1999, when personal care facilities were renamed assisted living facilities, the state required AFC homes with four or more beds to be licensed as an assisted living facility. Type D facilities are operated by the Department of Mental Health and Mental Retardation for persons with serious mental illness and developmental disabilities. Type E facility residents are the same as Type A except that they do not require assistance with ADLs, but only with medication administration.

9. Use of advertising terms such as "medication reminders or assistance," "meal and activity reminders," "escort service," or "short-term memory loss, confusion, or forgetfulness" will not trigger a requirement for certification as an Alzheimer's facility. (Source: Texas Administrative Code, Title 40, Chapter 92)