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Arkansas Association of Area Agencies on Aging Presentation to Legislative Health Reform Task Force

AUGUST 19-20, 2015

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Area Agencies on Aging (AAAs)•Private entities designated by the State pursuant to the federal Older Americans Act as recipient of state aging funds and federal Older American Act funds• AAAs are to “serve as the advocate and focal point for individuals within the community.” Older

Americans Act, § 306(a)(6)

•Designated multi-county regions covering the entire state

•7 of 8 AAAs provide in-home care services under the ElderChoices or Adults with Physical Disabilities waivers.

•Some AAAs also provide home health care and personal care to non-waiver clients.

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Waiver Services•ElderChoices (65+)• Homemaker• Companionship• Respite• Home-Delivered Meals• Adult Family Homes• PERS• Adult Day Care• Adult Day Health Care

•AAPD (18-64)• Attendant Care • Environmental Accessibility Adaptation/Adaptive Requirement• Counseling Support Management

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LTSS waiver services are already managed•Clients must be determined financially eligible by DHS.

•DAAS nurses perform medical eligibility assessment and annual re-assessments.• Reduction in ElderChoices caseload of almost 450 clients from December 2012 (pre-assessment) to this

month.

•DAAS nurses develop plan of care that specifies which services and in what quantity an individual will get.

•DAAS nurses assist clients in choosing provider(s) of services

•Services provided may not exceed what is specified in the plan of care.

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Waiver services save money by definition•Individuals must be eligible (physically) for nursing home level long-term care to be approved for the waiver.• That means that every waiver client could be

placed in a nursing home funded by Medicaid.

•The waivers are designed to allow individuals who require nursing home level of care but are able to stay in their home to do so with the receipt of waiver services.

•Federal approval of the waivers requires demonstration that they are cost-effective: cost of waiver services is less than the cost of nursing facility services.

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Waiver services save money even considering the nursing home provider tax

NF Core EC Core NF Halo EC Halo NF Total EC Total$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

AVERAGE ANNUAL EXPENDITURES PER RECIPIENT BY FUNDING SOURCESFY 2015

State GR Fed Match NF Tax Client Contribution

$10,470 $6,794

$41,473

$15,855

Source: Arkansas Medicaid Data Request, Provider ReimbursementIncludes personal care provided to EC clientsBased on monthly average clients

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Opportunities for rebalancing•In SFY 2014, 18,310 unduplicated individuals received Medicaid-funded nursing home services.

•11,688 unduplicated clients received waiver services• ElderChoices• AAPD• Assisted Living• Independent Choices

•Approximately 60% in nursing homes/40% receiving waiver services

•Imbalance in expenditures is even more striking• Approximately 80% nursing homes/20% waiver

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LTSS reform – key elements•Any reform of LTSS services should include the following:• Independent options counseling prior to decision regarding appropriate setting

• Timely standardized health assessment used for all clients in LTSS system

• Adequate funding for HCBS services to reflect travel costs and competition for workers with adjustments to reflect increases in minimum wage, ACA costs, etc.• Periodic rebasing of rates occurs on a timely basis for all providers, not just institutions

• True care coordination across all services.

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LTSS reform – key elements (cont.)• Expedited or presumptive eligibility to allow HCBS to be an option when immediate service is

required without having to wait to complete 45+ day eligibility process• Clients can be admitted to NF same day and NF gets paid from Day 1.

• Incorporate early identification of individuals likely to require nursing home level of care into PCMH model so decisions are made before a crisis occurs

• Flexibility • Consolidation of services• Shifting services/hours within the plan of care as needed• Ability to carry over limited number of hours from one period to the next• Hourly billing

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LTSS reform must be comprehensive•In 2014, average spending per client*:• $34 thousand for private nursing facility resident• $15 thousand for Assisted Living waiver client• $11 thousand for in-home services for waiver client

•In 2014, total spending by service*:• $620 million for private nursing homes • $16 million for assisted living• $82 million for in-home services for LTSS clients

•In order to reduce spending growth for this population, all LTSS funding must be in the equation.Source: RFI Data AppendixBased on unduplicated client count

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Providing additional HCBS services requires additional capacity•HCBS is a light-infrastructure service• No buildings to build or expand• Able to expand services and increase workforce rapidly in response to appropriate reimbursement

•Current capacity issues are largely a function of reimbursement.

•Example:• Waiver employee drives 60 miles (1 ½ hours) each way to provide 3 hours of HCBS to client in rural Arkansas• For 6 hours of employee time (all of which the employee must be paid for) and 120 miles reimbursed, provider

receives $50.28 (3 hours @ $16.76), which also has to fund administration and overhead.• If this level of services were provided 5 days a week and travel time was reimbursed, even at current levels, total

expenditures would be approximately $13,000—still below $34,000 for nursing care

•Approximately 100 different in-home care providers with multiple locations• County-by-county, the number increases to almost 850• Ready and willing to expand in an HCBS-supportive environment

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Arkansas Department of Health to Discontinue In-Home Services•AAAs are willing and ableto increase capacity to absorb clients, but can’t do it on a rate that is less than the costs of service.

•Other private providers face the same dilemma with funding.

•Rate increase is essential for resolution of capacity problem and viable alternative to institutional care.

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Questions?