Using Medicaid to Cover Services for Elderly Persons in Residential Care Settings: State Policy Maker and Stakeholder Views in Six States. Insufficient Capacity in the Waiver Program


Minnesota. Currently, insufficient capacity is not an issue because there is no waiting list for services. However, several respondents expressed concerns about future funding due to increased utilization of the more expensive Assisted Living Plus waiver service package, which includes a requirement for 24 hour supervision. These respondents felt that if the number of people receiving this package continues to increase, waiver slots may be capped.

Texas. All respondents agreed that the large waiting list for waiver slots was a major barrier preventing access, rather than affordability or provider availability issues. One felt that the lack of a guaranteed number of waiver slots was a disincentive for providers to enroll in the program. One provider said the state's bed hold policy was a major disincentive for providers to participate in the waiver program. This respondent said that providers could not afford to have a bed empty for 120 day periods, particularly more than once a year, because the room and board rate is only about $14.00 a day, much less than the private pay rate.

Another provider disincentive is the long time it takes to reduce the number of beds available to waiver clients in a participating facility even when there are no waiver clients to fill the beds. One respondent said that reducing the number of beds set aside for waiver clients usually takes 3 months after the request has been submitted, during which time the facility is losing money on the empty bed.

Wisconsin. In Wisconsin, respondents agreed that the major barrier to expansion is insufficient capacity in the waiver program. Approximately 9000 elderly and working age persons with disabilities are on waiting lists for the state funded Community Options Program and waiver services. Some noted that people who spend down to Medicaid eligibility in residential care settings often have to move to a nursing home because there is no waiver slot.

A few noted that residents and families do not understand why the state would pay more for a person in a nursing home rather than provide waiver services in residential care. But, as one respondent said, while on an individual basis it would cost less to keep people who spend down in residential care, fear of induced demand and fear of having a state funding source drive what's available keeps the state from expanding the waiver to cover people in residential care settings who have spent down. This person noted that doing so would make the waiver program an entitlement for people who spend down in residential care settings but not for people in their own homes. Over time, if the state kept everyone who spent down in residential care on the waiver, then it would wind up spending all of the waiver money in these settings and have very little left for home care.

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