Leaving Nursing Homes Behind: New Funds, Strategies

Funds from the Affordable Care Act are now available in most states to help people move out of, or avoid, institutional care

Article Highlights:
  • The federal department of Health and Human Services (HHS) recently announced that $3.7 billion in new funds will be made available to states to establish and expand community-based alternatives to institutional long-term care.
  • In addition, $621 million in new funds will be directed to 13 states over the next five years to establish and expand Money Follows the Person (MFP) programs, which already are in place in 29 states and the District of Columbia.
  • MFP programs are designed to help qualified Medicaid beneficiaries move out of nursing homes and back into their homes and communities.
  • While praising these initiatives, experts say barriers to full participation remain, including waiting lists and a lack of accessible and affordable housing for low-income people with disabilities.
by Miriam Davidson on May 6, 2011 - 3:38pm

The federal government is moving ahead with plans to expand access to home and community based services for individuals who receive Medicare and Medicaid benefits.

HHS Secretary Kathleen Sebelius announced in April that $3.7 billion in federal funds will be made available to implement the Community First Choice Option, a provision of the new health care law (the Affordable Care Act) which provides incentives for states to offer services enabling people to stay in their homes and communities, rather than in institutions.

“Our country recognized in the Americans with Disabilities Act that everyone who can live at home or in a community-based setting should be allowed to do so,” Sebelius said in announcing the funding.

“The Affordable Care Act provides states critical new dollars toward achieving that goal.”

In addition, Sebelius also announced $45 million for the establishment in 13 states of “Money Follows the Person” (MFP) programs, which enable people to make the transition from institutions like nursing homes back into their own homes and communities.

Other HHS initiatives to improve access to home care announced by Sebelius include:

  • new funds to coordinate and streamline care for “dual eligibles” (people who qualify for both Medicare and Medicaid);
  • new rules to make it easier for states to help people remain in their homes and communities, and
  • additional funds for states to upgrade their Medicaid computer enrollment systems.

Thirteen states added

Currrently, 29 states and the District of Columbia have Money Follows the Person (MFP) programs in place.

The new health care law extends and expands these MFP demonstration projects — which had originally been slated to expire this year — through 2016.  It also expands the program to 13 more states, with grants totaling $621 million through 2016.

These states are:

  • Colorado
  • Florida
  • Idaho
  • Maine
  • Massachusetts
  • Minnesota
  • Mississippi
  • Nevada
  • New Mexico
  • Rhode Island
  • Tennessee
  • Vermont
  • West Virginia

With the addition of the 13 states, there now are only seven states that do not have a MFP program (South Carolina has one, but it is inactive). They are: Alabama, Alaska, Arizona, Montana, South Dakota, Utah and Wyoming.

To qualify for the new funds, states must develop “person-centered plans” that allow individuals to determine which services they need to remain independent.

Lack of affordable housing and other barriers remain

Despite the increased funding, barriers remain for many people with disabilities who would like to stay in or return to their homes and communities.

The new law requires people to be in a nursing home or institution for 90 days before being eligible for MFP — shorter than the six months it used to be, but still long enough that many people lose their housing and support services in the community and have to start from square one.

“The big problem is lack of housing,” says Suzanne Crisp, of the National Resource Center for Participant-Directed Services at Boston College.

The Department of Housing and Urban Development (HUD) is working to alleviate the shortage, and has set aside vouchers for people with disabilities who want to participate in the MFP program.

In 2010, HHS and HUD dedicated $40 million to providing housing for people coming out of nursing homes, and gave 5,300 vouchers to nonelderly Medicaid recipients. Yet the need for affordable and accessible housing is still far greater than the supply.

“Another problem,” Crisp says, “is that services have to be adequate out there in the community for individuals to make this transition.” By providing incentives for states to provide more home and community-based services, the new funding for the Community First Choice Option should help alleviate that problem, Crisp says.

Some states also have long waiting lists for MFP programs. Unlike nursing home care, which states are required to pay for, these programs are typically optional. So when states have to reduce their Medicaid budgets, home and community based services are often the first to go.

Nevertheless, Crisp says that over the last six years about 12,000 people have moved from nursing facilities back into the community, and this additional funding should help another 13,000 move back home.

For more information

Crisp advises people who would like to bring MFP services to their state, or make sure that their state implements these services, to contact their local Aging and Disability Resource Center.

A report by The Henry J. Kaiser Family Foundation on Medicaid home and community based service programs;

A joint announcement from HHS and HUD about the housing voucher program

See also the Quest News Online article Medicaid Changes Expand Access to Home Care.

Editor's note: This article was changed on May 11, 2011, to correct the spelling of HHS Secretary Kathleen Sebelius' name.

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