Funding Long-Term Services and Supports (LTSS) for working aged disabled Americans.

• Author: Rapp, Helen L.

1. INTRODUCTION 302 II. BACKGROUND ON LTSS 305 A. What are Long Term Services and Supports? 305 B. Populations that use LTSS in the United States 306 C. Costs of LTSS 307 D. Funding History 307 III. HISTORY OF MEDICAID AND HCBS WAIVER PROGRAMS 308 A. 1981 Omnibus Budget Reconciliation Act (OBRA-81)--HCBS Waiver Programs 311 B. Americans with Disabilities Act--1990 312 C. Olmstead v. L.C. decision--1999 313 D. Deficit Reduction Act of 2005 314 E. Patient Protection and Affordable Care Act of 2010 314 III. THE NEED FOR A NEW AND INNOVATIVE APPROACH TO LTSS 315 A. An Alternative Report: A Comprehensive Approach to Long-Term Services and Supports 318 1. Recommendation Five 318 2. Recommendation Six 319 A. AAPD Proposed Pilot Program 320 B. AAPD Proposed Pilot Program Solution 321 C. A Real Life Example of how this new Program would look 322 D. How Many Americans would be Eligible for the New 323 Program? E. What Would the New Program Cost and can we afford it? 323 IV. CONCLUSION 326 I. INTRODUCTION

   World renowned scientist Stephen Hawking is said to have the greatest mind in physics since Albert Einstein. (1) Now 72 years old, Hawking has enjoyed success as a researcher, university professor and best-selling author. (2) His estimated net worth is $20 million dollars. (3) Hawking comes from a family of modest means and his fortune is completely the result of more than 50 years of hard work. (4) Hawking also has Amyotrophic Lateral Sclerosis (ALS). (5) As a result, he is almost completely paralyzed, has been confined to a wheelchair since the late 1960's and speaks using a computer-based speech synthesizer. (6) He requires personal care assistants (PCAs) to perform all activities of daily living. Hawking is a British citizen, which means that his medical needs are covered by the British National Health Service (NHS) (7). Under the care of the NHS, as a disabled person, Hawking is entitled to free medical care and medicine, and he is eligible for home adaptations, equipment and personal care to allow him to live at home. (8) Had he been a US citizen living in the United States, he may not have had the opportunity to accomplish the amazing things that he has, because in order to qualify for Long-Term Services and Supports (LTSS) such as PCAs, he would have to be Medicaid eligible. This means that his income would need to be significantly below the middle-class standard.

   John Robertson was born with a condition called spinal muscular dystrophy. (9) John uses a wheelchair and relies on complex rehabilitation technology (CRT) in order to live independently. (10) When John graduated from law school, he was offered a job at a prestigious law firm in another state with an annual salary of $120,000. (11) John's personal care costs are approximately $90,000 per year, which are not covered by his employer-sponsored insurance. Although John relied on Medicaid to cover his personal care needs while he was a student, Medicaid is not portable to the state in which he would work and even if it was, his income would make him ineligible. John must now decide whether to forego a job at a prestigious law firm in order to maintain access to LTSS. This reality denies John the ability to live as independently as possible and become a taxpayer. (12)

   19-year old Jane has Cerebral Palsy. (13) She has lived in Cleveland, Ohio her entire life. Although Jane cannot walk, stand or use her right hand and arm, she has always been mainstreamed (14) in school and has recently graduated from a private, college prep high school. Jane has excellent verbal skills and uses a power wheelchair for mobility. Jane is attending a 4-year college and aspires to live independently and support herself. Jane will also need lifetime support from PCAs. When meeting with a social worker from the County Board of DD, Jane was "reassured" that they would help her make sure her income never jeopardizes her Medicaid eligibility. What a demoralizing experience for a young woman on the brink of starting her adult life to realize that she would be resigned to low income if she wanted access to the support she needed to live.

   These are some of the dilemmas faced today by the over 3 million significantly disabled Americans, many of whom depend on Medicaid for LTSS, in obtaining the services they need to simply live. (15) While the landmark 1990 Americans with Disabilities Act (ADA) (16) has done a lot to improve the lives of people with disabilities, the reality is that using Medicaid as the vehicle for funding LTSS, places unreasonable restrictions on disabled people who want to live independent lives and be as successful as possible.

   The Federal Government must change funding for LTSS in order to provide disabled Americans with real choices regarding living arrangements and maximize their earning potential without fear of being deprived of support they cannot live without. Part II of this note provides background information on LTSS (what they are, who uses them, what they cost and how they are currently funded). Part III examines the Medicaid Program and specifically Medicaid HCBS (17) Waiver Programs which provide the bulk of LTSS funding today. A brief history of the federal laws, amendments and policies that have impacted Medicaid LTSS will be provided. Part IV analyzes an alternative to Medicaid for LTSS funding for those working age disabled individuals who would not otherwise be Medicaid eligible. This section will specifically focus on recommendations from the congressionally established Commission on Long-Term Care and a Pilot Program proposed by the American Association for People with Disabilities (AAPD). Finally, Part V concludes that the Federal government must take action to establish a stand-alone, non-Medicaid Program to provide LTSS for working age, disabled Americans who are capable of working and living independently.

2. BACKGROUND ON LTSS

   1. What are Long Term Services and Supports?

      Long-Term Services and Supports (LTSS) are defined as assistance with activities of daily living (ADL) such as bathing, dressing, eating, transferring and walking or instrumental activities of daily living (IADL) such as money management, meal preparation, house cleaning, transportation and medication management. (18) LTSS services include residential care in facilities like nursing homes, but also include home and community-based service options (HCBS) such as home health care, personal care assistance (PCA), adult day care and homemaker services that help meet peoples' needs without institutional placement. (19) During the past two decades, there has been a major shift toward serving more people in home and community-based settings rather than institutions. (20) This shift is the result of a combination of individual preferences and states' obligations under the Supreme Court's 1997 Olmstead decision. (21) LTSS does not include medical or nursing services needed to manage an individual's underlying health condition. (22) People may need LTSS for a variety of reasons including physical, cognitive, or developmental disability, chronic health issues or simply old age. (23) LTSS can be provided formally by people who are paid for these services or informally by family members and friends of people who need them. Properly defining ADLs and IADLs and assessing each individual's ADL and IADL needs is critical, because it factors into determining whether a person is eligible for LTSS benefits or not. (24) Typically a person needs to show that they need assistance with two or more ADLs in order to be eligible for LTSS benefits. (25)

   2. Populations that use LTSS in the United States

      In the United States, there are currently over 12 million people who require some level of LTSS. (26) This includes people who rely strictly on the loving support of unpaid caregivers (family and friends) as well as those who utilize paid caregivers. (27) Approximately 3.2 million of these people are considered eligible for LTSS benefits because they need assistance with two or more ADLs. (28) Although people need LTSS for a variety of reasons, it is useful to break the group into 3 broad categories and examine the issues associated with each. These categories are (1) children (18 years and under), (2) working age adults (19 - 64 years) and (3) the elderly (65 and older). (29) The largest and the fastest growing of these populations is the elderly group. As advances in medicine allow people to live longer, the number of elderly people in need of some level of LTSS will grow dramatically. Some estimates predict that by 2050, the number of Americans in need of LTSS will more than double from 12 million to 27 million (see figure 1), largely driven by the rapidly growing elderly population. (30)

      The other two demographic groups are not inherently likely to grow significantly in numbers and should be considered to be steady in size. Of the 12 million Americans currently requiring LTSS, 3% are children, 47% are working age adults (19 - 64 years) and 50% are elderly (over 65). (31) The type of LTSS care required varies extensively within and across groups.

   3. Costs of LTSS

      LTSS can be very costly. It is difficult to capture the total cost of LTSS in the United States because the majority of it is provided by unpaid family and friends. In 2012, the estimated cost of paid LTSS was $219.9 billion dollars, which represents 9.3% of personal health care spending in the United States. (32) The value of unpaid, family caregiving was estimated to be worth $450 billion in 2009. (33) Some individuals require only minimal support (transportation to doctor's appointments or help paying bills) (34) and their care maybe financially manageable, but for some LTSS costs are overwhelming. Examples of the more costly type of LTSS include nursing home and other institutional care facilities and PCA support for home and community based individuals. The average annual cost for a semi-private room in a nursing home is...