PART TWO: The case for the Community Integration Act

The Community Integration Act

PART TWO: The case for the Community Integration Act

When Medicaid created long-term services and supports in the mid-1960s, the program inadvertently generated a bias to serve Americans in facilities and institutions. Now fifty years later and twenty-four years after the Americans with Disabilities Act, the community is much less accepting of segregating people with disabilities in expensive institutions.  

The bias is very evident to many Americans: “why not spend the money so the individuals can stay in their home?” The most rational claim is that serving people in their home, with their families, spending money in the local community, with access to employment is actually less expensive. Home and Community-Based Services (HCBS), do not represent a minuscule saving of state and federal Medicaid funds, diverting people from expensive institutional care can cut Medicaid costs in half. Harkin’s report states that Alabama’s Independent Living program cost under $11,000 per person compared to over $36,000 for people served in an Alabama nursing facility.

The Health, Education, Labor and Pensions Committee report also shows that while many states have increased the number of people that receive HCBS they have not necessarily decreased the nursing home population. Medicaid HCBS is only available to individuals at a “nursing home level of care,” but nursing homes have been effective at “back-filling” the institutions and preventing the states from saving federal and state funds. Maryland served over six thousand with HCBS between 2008 and 2012, but decreased the number of people in nursing homes by less than 400. Colorado likewise expanded HCBS to over five-thousand nursing home eligible people, but only decreased individuals in expensive facilities by 84.

Between 2000 and 2012 there was a 31% increase in the total amount of Medicaid funding for nursing homes. Nationally we paid a $12.4 billion more in Medicaid funding for nursing homes during those years despite an 18% reduction in number of nursing home residents.

At the time of the Olmstead decision, Tennessee was dead last in the country on providing alternatives to costly nursing homes. Our state spent 99.5% of federal Medicaid Long-Term funding on institutions in 2000 and has advanced that to 31.3% today. Tennessee has done well, but is still nowhere near where the state should be to comply with the Civil Rights focus of Olmstead. The Community Integration Act is what our state needs to rebalance our Medicaid funding and really give people the choice to live at home and not be forced into expensive institutions.