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


A few mentioned the need for a different rate system than the current one.

  • A case mix system would be preferable over what we have now: a fixed Special Assistance and Medicaid rate. The basic service rate is too low and the enhanced rate is minimal. There has been no increase this year and increases in the past year have not equaled what the cost reports said it should pay. With a case mix system, you could track expenditures to determine whether a resident did in fact get the service that the provider is reimbursed for.

  • We must assure that the public system supports and demands quality from providers. Medicaid payment is totally inadequate for the level of care required. It pays for one hour a day and the rate for that hour is too low. $270 per month for one hour a day, plus a little more if enhanced care. There is no direct requirement that all Medicaid money for direct care staffing be actually paid for direct staffing.

  • Rates are inadequate. Since 1995, the state has used a cost reimbursement method based on cost reports--averaging, a state wide average. Using one rate for the whole state has its plusses and minuses. There are no incentives for those who aspire to a higher level of quality care. We need a case mix system. Then you are paying for the amount of care someone needs. Under the current system, there is no incentive in the reimbursement system to take heavy care residents.

  • The biggest quality issue is staffing and the Medicaid rate for direct care workers is not adequate. We give the staff too heavy a workload, too many residents to care for in a limited amount of time. Is it fair to the workers and the residents? Medicaid should require that you have to pay staff adequately, using a case mix model to assure that residents' needs are met.

One mentioned that the Medicaid rates in adult care homes are not sufficient to provide care to persons with dementia.

  • The state does not pay a sufficient rate to take care of people with dementia in special care units. Special care residents don't qualify for the enhanced personal care rate--because Medicaid only pays for hands-on physical assistance. Cueing and set up takes more time than doing something for the resident. So we encourage dependence. Without a case system, we will not get designated funding for dementia and this population gets ignored.

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