OP-ED | Rebalancing Long-Term Care Offers Budget Bright Spot
Connecticut continues to face the fiscal strains of a slowly recovering economy and persistent unemployment. That means lawmakers in Hartford face difficult decisions and new challenges to Connecticut’s already strained safety net.
But, good fiscal policy doesn’t always come at the expense of good public policy. In fact, the governor and legislature’s budget proposals offer a path to achieving both when it comes to providing long-term care for our seniors and people with disabilities. It’s time we embrace a balanced long-term care system that provides more consumer choice and better care at a lower cost.
Connecticut has historically supported a long-term care system that is heavily reliant on institutional nursing home care. This restrictive, one-size-fits-all approach is more costly (averaging $74,825 per year) and less desirable to most consumers than receiving care at home. Consider, in 2009, the state spent 65 percent of its Medicaid long-term care dollars on institutional care for older residents and people with disabilities, even though 75 percent of consumers preferred less costly options in the community.
That policy direction is no longer sustainable given the state’s demographic trends. Connecticut anticipates a 25 percent increase in the demand for long-term care services by 2025. Fortunately, bipartisan consensus is building to shift long-term care funding to community based alternatives and family caregiver supports that deliver cost-effective care in the setting consumers prefer. Specifically, Gov. Dannel P. Malloy’s budget proposes a $13 million state investment to expand community based services. This includes $10 million in bonding for nursing home “right-sizing,” which was also included as part of the Finance Committee bonding package last week. Right-sizing begins with the simple premise that our long-term care system should respond to the people it serves. Put in market terms: supply should match demand.
Through “right-sizing,” nursing homes can compete for grants to redesign, update and modernize their business model to match the needs and preferences of local residents.The initiative encourages flexibility and fosters innovation. A nursing home, for example, could apply for funding to convert a portion of their facility into an adult day center or offer temporary respite services for family caregivers. Offering such services allows the nursing facility to expand its customer base beyond traditional clients that need institutional care, and consumers gain new options for home and community based services.
Taxpayers also benefit. That’s because shifting state resources to cost-effective community based supports is less expense and will result in more people served for each dollar spent. On average, Connecticut can serve someone in the community at about one-third the cost of serving that same individual in an institution. It is no coincidence that one of the most successful programs to expand home and community based care—Money Follows the Person—was first created as part of the Deficit Reduction Act of 2005. Empowering consumers to choose community based services, when those services are appropriate, saves Connecticut money and improves health outcomes.
CT21 has done studies calling for rebalancing LTC for all the reasons we cite here (see www.CT21.org ). In addition, CBIA’s “Turning the Tide” report on state spending says rebalancing LTC is one of the keys to restore and sustain fiscal health in the Connecticut state budget.
Let’s be clear: right-sizing does not mean we can abandon traditional nursing home care. To the contrary, right-sizing fosters healthy, diversified business models so nursing homes remain financially viable to deliver high quality care for individuals that need or choose institutional care. The policy objective is to strengthen the full continuum of long-term supports consistent with consumer preferences in each community.
Both fiscal expedience and consumer preferences demand action. Let’s seize this opportunity to empower consumer choice, strengthen our long-term care system and stretch limited state resources.
Nora Duncan, state director, AARP Connecticut and Peter M. Gioia, vice president and economist, Connecticut Business & Industry Association.