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By Monica E. Oss

The push to move consumers needing long-term services and supports (LTSS) out of residential placements and into community settings continues. Part of the push is that there are currently 59 lawsuits related to Olmstead open across the country, which require states to find ways to support care individuals in the community (see Olmstead Litigation in the 12 U.S. Circuit Courts of Appeals). And there are the cost issues. The majority of the services—both institutional and community-based—required to support these consumers are covered by Medicaid. Generally, the community-based options are less expensive than residential care options (see For I/DD, The Question Isn’t Managed Care Or Not-It’s Residential Care Or Not). But while there are an estimated 6.2 million people with I/DD who are on the Medicaid roles, only 689,144 (11.2%) are receiving HCBS services. An estimated 200,000 are on state HCBS waiver waiting list for those services (see How Many Consumers With I/DD Are Served By Medicaid HCBS Waivers & How Many Consumers Are On A Wait List?: An OPEN MINDS Market Intelligence Report).

The raises the question, what’s the hold up? A recent congressional briefing identified four major challenges to HCBS availability for consumers with I/DD (see Congressional Briefing Identifies Waiting Lists, Workforce, Caregivers & Housing As Key Challenges To Medicaid HCBS For I/DD). These challenges include lack of state funding causing waiting lists, high staff turnover rates and overall lack of adequate numbers of direct support professionals, state reliance on unevenly skilled family caregivers, and limited housing opportunities. Without addressing these issues, the numbers of consumer with I/DD with the option of living in the community will continue to lag.

Waiting Lists & State Funding Shortages—Nationwide, about 75% of Medicaid funding for LTSS is for HCBS for people with I/DD. Community-based services are less expensive than the 24/7 care of a residential setting – the annual cost of care for a consumer receiving HCBS supports is about 13% less than residing in a state institution, and about 20% less than residing in an intermediate care facility (ICFs). If HCBS save state Medicaid programs money, why are there still wait lists? Because HCBS are an optional, waiver-based Medicaid service. This means that as states are balancing their budgets, other mandatory programs and services included in Medicaid state plans must be funded first (see What Are Medicaid Waivers & Why Do They Matter?: An OPEN MINDS Market Intelligence Report). Medicaid HCBS funding would need to increase by 26% nationally to account for state budget shortfalls that would allow funding for all consumers on wait lists. For more on the issue of wait lists for HCBS, see:

  1. How Many Consumers With Disabilities Can Live At Home?
  2. For I/DD, The Question Isn’t Managed Care Or Not-It’s Residential Care Or Not
  3. Understanding The Opportunities In The I/DD Medicaid HCBS Wait List

Lack of Housing—To live in the community requires housing, and housing options that are safe, affordable, and appropriate for families and individuals with I/DD are in limited supply. Many families and individuals with I/DD lack the financial means to purchase homes. As a result, states often house adults with I/DD in ICFs and other congregate care settings; a more expensive option than HCSB services. For more housing issues, and a look at state initiatives focused on housing, see:

  1. Housing Initiatives Multiply, But What Is The Big Picture?
  2. Federal Report Finds Significant Rental Housing Market Discrimination Against People With Developmental Disabilities Or Mental Illness
  3. The Housing To Heath Care Evolution
  4. New York Creates 459 New Housing Opportunities For People With Developmental Disabilities
  5. Illinois Housing Development Authority Launches Its First Single-Site Supportive Housing Development For Adults With I/DD
  6. First Orlando-Area Housing Complex For Adults With Developmental Disabilities Opens

Workforce Issues—Community-based supported living settings not only depend on housing but also on direct support professionals (DSPs) to deliver HCBS in the community. However, demand for DSPs exceeds supply. And, the number of DSPs is dropping, in part because the DSP wage scale is low. The average wage is $10.72 per hour – as a result, most DSPs are compelled to work multiple jobs. About 37% are uninsured, and 21% qualify for Medicaid. For more on workforce issues affecting provider organizations, see:

  1. Preparing For Your ‘Augmented’ Workforce
  2. Robotics Taking Over The Health Care Workforce?
  3. Staff Is Your Biggest Investment & Your Greatest Asset – Unless They Burnout
  4. Home Care Minimum Wage & Overtime Rules To Move Ahead With Supreme Court Decision
  5. Georgia Increases Child Welfare Worker Salaries 19%
  6. Illinois Senate Approves $15 Hourly Wage For Developmental Disability Direct Support Care Professionals
  7. Raising Pennsylvania Direct Care Staff Hourly Wages To $15 Projected To Result In Net Taxpayer Savings
  8. New York Non-Profits Providing Developmental Disability Services Report 23% Staff Turnover Rate

Family/Caregiver Stress—In addition to housing and paid support staff, community-based care for consumers with I/DD relies on the participation of families and caregivers. Caregivers provide key services and often provide housing for Medicaid HCBS recipients with I/DD. About 60% of Medicaid HCBS recipients with I/DD receive housing and care from a family member who must then navigate both complex Medicaid systems and personal financial limitations. About 44% of families caring for an adult child with I/DD, and 39% of families of a child with I/DD have incomes near the federal poverty level, at or below $25,000. For more on family and caregiver support issues, see:

  1. Only 27% Of Unpaid Caregivers For Someone With Cognitive Impairment Use Caregiver Support Services
  2. States Should Evaluate Family Caregiver Support Services By Tracking Demographics, Family Impact & State Support
  3. Close Caregiver-Recipient Relationships Result In Lower Informal Care Cost For Dementia
  4. New California Law Requires Hospitals To Increase Caregiver Involvement In Discharge Planning

How likely are these factors to be addressed? It’s a mixed bag. A study that looked at Olmstead lawsuits brought against states between 1999 and 2011 found 131 cases total and 90 cases that were resolved by the court, showing that these lawsuits are important for prodding states to greater HCBS options (see State Olmstead Litigation And The Affordable Care Act). Whether states are willing to increase their Medicaid spending to increase HCSB is another story.

The direct support staff issue is not getting better—and immigration reforms and an aging population are going to keep DSP availability low. And the compression on budgets and Medicaid rates for services keeps the compensation levels for DSPs low. Finally, with regard to housing, the investment in supported housing in the U.S. has remained flat over the past decade (see Housing Initiatives Multiply, But What Is The Big Picture?).

It’s in this stressed market that I/DD funding is moving to more managed care and value-based contracting. From the health plan and provider organization perspective, there are many challenges without many readily apparent answers. For more, check out these resources from the OPEN MINDS Industry Library:

  1. Living In The Community-The Landscape For Adults With I/DD
  2. New Opportunities Serving Adults With Autism
  3. Housing Initiatives Multiply, But What Is The Big Picture?
  4. A Question Of Permanent Supportive Housing

For more on this topic, don’t miss this year’s 2018 I/DD Executive Institute on June 4 in New Orleans. Opening the day will include Olivia J. Garland, Ph.D., Vice President State Consulting and Solutions Architecture for Individuals with Intellectual & Developmental Disabilities, Optum Government Solutions; and Lilli Correll Vice President, Product Development and Solution Design Optum Behavioral Health, bringing a health plan perspective to the issue in their opening plenary presentation, Managed Care & The I/DD Population: The Health Plan Perspective On The Strategic Challenges & Partnership Opportunities In A New Market.

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