Rhode Island Medicaid Reform Could Be Costly

The good news is that Americans are living longer than ever. The bad news is that this fact, combined with laws that encourage dependency on government to pay for long-term care, is putting a great strain on state budgets.

Last year, Rhode Island received a “global waiver” from the U.S. Health and Human Services department, which lets it revamp its Medicaid program. Medicaid is a common way for nursing home residents and others to pay for long-term care.

The Ocean State Policy Research Institute recently released a new report calling for addressing the state’s rising costs of paying for long-term care.

Here’s the press release:

Today, the Ocean State Policy Research Institute released a new report titled “The Age Wave, The Ocean State, and Long-Term Care” regarding the future of long-term care and Medicaid reform in Rhode Island. The report was based upon an in-depth study of Rhode Island’s health care industry conducted by Steve Moses, OSPRI Fellow for Health Care Policy and President of the Center for Long-Term Care Reform.

“Rhode Island is fortunate to have a one-of-a-kind opportunity to reform our health care system with the Global Medicaid Waiver,” said OSPRI President William Felkner. “Steve [Moses] is an expert in the field of Long-Term Care, and when I contacted him about the Global Medicaid Waiver, he immediately saw the opportunity to bring real reform to the Ocean State.”

Moses spent a number of days interviewing dozens of public officials and related professionals about the state of Rhode Island’s health care system and the impact that the Global Medicaid Waiver could have on long-term care. The report outlines the immediate and underlying problems that the state is facing and proposes potential solutions that would reduce costs to both the state and taxpayers while providing more efficient and effective services.

“Our state government has reached the crest of the wave, and if we don’t act soon to find and implement viable solutions to our health care crisis, it’s all going to come crashing down on us,” Felkner said. “Steve and I look forward to working with both public and private sectors to reform the long-term care system in our state.”

The full report can be found on the Ocean State Policy Research Institute’s website: www.oceanstatepolicy.org/docs/AgeWave.pdf.

Here’s the short summary:

Rhode Island’s current plan under the global Medicaid waiver to expand home and community-based services while reducing nursing home use without controlling the state’s wide-open LTC eligibility system is, however unintentionally, highly likely to increase costs and undermine private-sector LTC financing sources. Careful study and further review of the issues raised in this report will identify corrective actions that can reduce costs by targeting Medicaid benefits under the global waiver to people most in need and by encouraging private, market-based solutions based on savings, investment and insurance to fund long-term care.

In other words, promises to “save money” through reform may end up costing more.

Cross-posted from State House Call.