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


While some respondents strongly supported or opposed negotiated risk or shared responsibility agreements, many said they did not think there were any issues related to them, and others said they didn't know enough about them to comment. Those that were knowledgeable had conflicting views.

The most frequently cited situation where risk agreements were thought to be needed was the non-compliant diabetic. One provider, asked by a state inspector to explain why a diabetic was eating chocolate cake, responded: "Whose choice is it? The elderly person, the provider, or the government who is paying for service?" Many felt that properly prepared service plans should be able to address such situations and that negotiated risk agreements were not needed.

Others said that providers were very reluctant to have residents assume risk due to both outmoded paternalistic views and concerns about lawsuits. In Florida, where there is a major liability insurance crisis, some saw them as a potential solution, but one noted that trial lawyers opposed them and felt they would not hold up in a lawsuit. In other states, some felt that while families wanted freedom and autonomy for their loved ones, they still wanted the facility to be liable for anything bad that might happen.

A few respondents held the view that until elderly persons are adjudicated incompetent, they should be able to do whatever they want. While others agreed, they said that families would still hold a facility responsibility for a negative outcome.

Some felt that there were certain health and safety responsibilities that providers should never relinquish, and that since providers were paid to use their professional judgment to provide a safe environment, negotiated risk agreements should never be used where there are safety issues. For example, one provider noted that a resident with dementia should not be permitted to use a gas stove. This same person noted that it would be helpful if the state regulatory agency would define parameters -- and identify areas that are not appropriate -- for shared risk agreements.

Very few raised the issue of assessing competency to enter into and continue in a shared responsibility or negotiated risk agreement. When asked specifically about this issue, most agreed that the lack of a standardized method for assessing cognitive impairment and competency, particularly in persons with mild cognitive impairment, was potentially a major problem. One lawyer noted that if he were representing a resident who had signed such an agreement, the first thing he would look at was how a provider determined that the resident was competent to enter the agreement.

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