The federal health reform legislation – Patient Protection and Affordable Care Act (PPACA) – includes an ambitious list of changes to long-term care (LTC) services for seniors and the disabled. Most include a massive infusion of federal funding to help state Medicaid programs provide more LTC through home and community-based settings. Here’s a quick run-down of the new LTC reforms:
Community Living Assistance Services and Supports (CLASS) Program:
- Creates a national, voluntary insurance program for purchasing community living assistance services and supports (CLASS program).
- Following a five-year vesting period, the CLASS program will provide individuals with functional limitations a cash benefit of not less than an average of $50 per day to purchase non-medical services and supports necessary to maintain community residence.
- Financed through payroll deduction of about $75 a month. All working adults will be automatically enrolled in the program, unless they choose to opt-out. The new tax is effective January 1, 2011.
- Expected to cover $5 billion to $10 billion worth of non-medical services and supports annually.
Medicaid Money Follows the Person Rebalancing Demonstration:
- Extends the multi-billion dollar Medicaid Money Follows the Person Rebalancing Demonstration program through September 2016.
- Primary objective of moving Medicaid eligible seniors from nursing homes to home, group homes, or assisted living. The three-year old initiative helps states to reduce reliance on nursing homes, while developing community-based long-term care options and enabling frail seniors and people with disabilities to live in the community.
- Estimated $1.7 billion in additional federal funding.
New State Options for Home and Community-Based Services:
- Provides states with new options for offering home and community-based services (HCBS) through a Medicaid State Plan rather than through a waiver.
- HCBS programs provide an array of non-medical services and supports – such as personal care attendants and in-home technologies – to help frail seniors and persons with disabilities live independently in their own homes.
- PPACA ends the need for states to show federal budget neutrality to operate or expand a HCBS program.
- At state option, this applies for individuals with incomes up to 300% of the maximum SSI payment and who have a higher level of need.
- States may extend full Medicaid benefits to individual receiving home and community-based services under a State Plan.
- $2.4 billion new federal funding over ten years.
- Effective retroactively to October 1, 2010.
Community First Choice Option:
- Establishes the Community First Choice Option in Medicaid to provide community-based attendant supports and services to individuals with disabilities who require an institutional level of care.
- Provides states with an enhanced federal matching rate (FMAP) of an additional six percentage points for reimbursable expenses in the program.
- $6 billion in new federal funding over 10 years.
- Effective October 1, 2011. Option sunsets after five years unless renewed by Congress.
State Balancing Incentive Program:
- Creates the State Balancing Incentive Program to provide enhanced federal matching payments to eligible states to increase the proportion of long-term care services provided through the community (instead of nursing homes and similar institutional settings).
- Selected states will be eligible for higher federal match for Medicaid expenditures for the non-institutional long-term services and supports. HHS will select states based on an application process.
- Total federal incentives of $1.8 billion.
- Effective October 1, 2011 through September 30, 2015.
For More Information on Long-Term Care Reforms:
The new LTC initiatives in the PPACA create tremendous opportunities for state Medicaid agencies, state aging agencies, and health care organizations. For help or more information, I recommend that you contact my colleagues at Sellers Dorsey. Pat Brady and her highly skilled LTC reform team are already helping states and private organizations design and implement innovative LTC programs. These are true win-win efforts, supporting independent living and improving care, while saving dollars for taxpayers.