Money Follows the Person—Unless It Doesn’t

Published In Blog

October 21st, 2018

A federal program that has made it possible for more than 88,000 seniors and people with disabilities to make the transition they craved — moving from nursing homes back into houses, apartments, and group homes in their communities — is now being threatened with budget cuts and possible extinction.

The legislation was initially passed in 2005 because state spending of funds for Medicaid, called Medi-Cal in California, was out of whack. With the no-nonsense title of “Money Follows the Person” (MFP), the measure was authorized as a “rebalancing demonstration” to redistribute the money spent on long-term care in institutions and funnel it to pay for care in community settings.

Institutions — mostly nursing homes providing long-term care — were hogging a disproportionate share of Medicaid money. While only about 6.4% of the Medicaid population received care and housing in such facilities, nearly half the Medicaid budget was spent on it. The intent of MFP was not only to help make it possible for people to move out of nursing facilities, but to make fundamental changes in state policies so that Medicaid funds would “follow the person” to the new, more independent setting.

Federal funding for MFP expired on September 30, 2016. States are free to use the money remaining in the grant through the year 2020, but most programs have had to cut back the available services by about 40%. Proposed legislation, the EMPOWER Care Act, would extend the MFP program for five more years. Proponents warn that unless the EMPOWER Care Act is passed, funding will run out entirely — as will the momentum gained for encouraging individuals to transition out of institutions.

How and Why MFP Works

Initially, 30 states were provided federal grants to develop MFP programs; that number later swelled to the current total of 44. The program funds are earmarked for services — including housing coordination, case management, and telehealth services — to help individuals move out of nursing facilities and then help manage their care in a more homelike setting.

The specific benefits and services offered differ in each state’s program. However, most include an initial assessment of both the individual’s capabilities and the housing to which he or she will be moving. If needed, MFP money can be designated for goods and services to make it possible for a person to stay safe and independent. For example, the program might pay for additions to a home — including stairlifts, wheelchair ramps, adaptive lighting, or bathroom safety modifications. Examples of services some state programs include are transportation, moving assistance, and providing service animals.

Separate comprehensive evaluations of MFP programs by Health and Human Services and the Centers for Medicare and Medicaid Services found strong evidence that individuals’ quality of life improves when they transition from institutional long-term care to home-based services. The effect lasts, as those improvements were largely sustained two years after the moves.

MFP programs are cost-effective, too. On average, monthly expenditures for those participating in the re-balancing demonstration declined by $1,840, or 23%, during the first year of transition from a nursing home to home and community-based care.

Yays — and a Nay

Justice in Aging, a national organization focused on securing access to affordable health care, economic security, and the courts for older adults with limited resources, is a strong proponent of the program. And in an October 3, 2018 letter urging the Senate Special Committee on Aging to support for the EMPOWER Care Act that would keep the program alive, it explained why: “MFP is a common-sense way to fund Medicaid Home and Community-Based Services that help older adults age in place and improve their quality of life, while saving money that the federal government and states would otherwise spend on costly institutions.”

Many of the MFP program participants are also pleased and proud to share their success stories.

Among them:

  • Linda Merkle, of Owings Mills, Maryland, who lived in a nursing home for 5 ½ years after having a stroke, but recovered enough in that time that she wanted to go home and believed she could do it. Nursing home staff were not familiar with MFP, but Merkle learned about it from two people who were visiting another resident at the nursing home. “If I hadn’t met those two people, I would probably still be there, which would be terrible because I love being in my own home,” she says. “It’s like being free.”
  • Gladys Winn, of Suffolk, Virginia, a woman in her late 90s who became a resident in a local nursing home after she fell and broke her hip. When she got word that she had to move back into her home within 20 days or lose it completely, she became severely depressed and anxious. With help from an MFP program, she was able to make a quick move back home — and now enjoys fishing and participating in church and community activities.
  • John Sims, of Grand Rapids, Michigan, who was admitted to a nursing home shortly after he had a stroke that left him paralyzed from the waist down. His inspiration for wanting to transition out was his eight-year-old son. He wanted the boy to live with him in an accessible apartment close to school — and the MFP program made that possible. “I felt that I was a productive citizen before the stroke, and now I feel I can be a productive citizen after the stroke,” Sims says. “And I actually feel I have something to offer — not just to my family, but to the community.”

But one group less than enthused about MFP is nursing home owners, many of whom claim they’re cash-strapped and have been forced to cut back services or even close their doors due to financial woes. To compensate, those that remain are changing the way they’ve customarily done business — admitting more short-term patients in need of rehab as opposed to long-term residents, as well as accepting individuals they would have rejected in the past: those with more complicated and compromised medical conditions. Some facilities have also morphed their offerings to include pharmacies or homecare services.

Two nursing homes based in Connecticut, Hebrew HealthCare and Affinity Healthcare Management, which both filed for bankruptcy recently, cited the MFP program as adding to their financial challenges.

Still, Matthew Barrett, CEO of the Connecticut Association of Health Care Facilities, cites a silver lining of sorts in the fact that his state has an above-average number of residents who have Alzheimer’s disease and receive federal money to help pay for their care. He believes nursing homes are the best option for many of them. “I have an optimism that skilled nursing will be considered part of the solution to Connecticut healthcare,” he says.

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