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1993.08.02 : Medicaid Alternatives to Institutional Care

Contact: Anne Verano (202) 690-6145
August 2, 1993

    Alternatives to institutional care provided by the Medicaid program are
helping to slow the growth in the nation's nursing home population and serve
people in their homes, according to Bruce C. Vladeck, Administrator of the
Health Care Financing Administration.
     "HCFA is working closely with the states to develop home and community
alternatives to institutional care," Vladeck said.  "These waiver programs may
cover both the elderly and persons with disabilities under 65, ranging from
young children at home on respirators to men and women suffering from
AIDS."
     On July 1, Alaska became the 49th state to offer services under Medicaid's
home and community-based waiver program.  Arizona, the only state not using
these waivers, operates a similar program through a statewide managed health
care plan.
     "Initiated during the early 1980s, the community-based care program has
grown to include one of every five Medicaid recipients in long-term care,"
Vladeck added.
     Medicaid, jointly administered by HCFA and state governments, currently
offers alternative services through 184 programs nationwide.  Certain Medicaid
rules are waived to target services to specific groups of people.
    Each state has flexibility to design programs which best benefit its own
citizens.  Medicaid recipients receive home and community-based services
specifically designed to meet their individual needs.
     In fiscal year 1992, Medicaid served an estimated 400,000 recipients in
home and community-based waiver programs, which Congress authorized in
1981.  Waiver programs are approved initially for three years, with five-year
renewals.
     "These 400,000 are all sufficiently disabled to qualify for nursing home
services," Vladeck continued.  "These waiver programs have supported
thousands of people in homes and community-based settings."
     Medicaid, which currently pays almost half of all U.S. nursing home costs,
covering part or all of the costs for roughly two-thirds of the residents,
increased nursing home payments from $10 billion in 1980 to $24 billion in
1990.  These costs might have been significantly higher if not for the growth of
home and community-based waiver programs nationwide, Vladeck said.
     From 1980 to 1990, Medicaid spending for community long-term care,
including home and community-based waiver services, rose from $400 million
to $3.9 billion.

EDITOR'S NOTE: The Health Care Financing Administration, an agency of the
U.S. Department of Health and Human Services, administers the Medicare and
Medicaid programs, which help pay the bills of 67 million Americans.  HCFA's
estimated fiscal year 1993 expenditures are almost $230 billion.