Nursing Home Use By Medicaid Seniors Plummeting
Long-stay nursing home care by seniors enrolled in Medicaid has been plummeting for 15 years. It is not clear exactly why, but there are probably several reasons. First, state Medicaid programs have been shifting care from nursing facilities to home and community-based settings — a step that seniors themselves favor and one that may save money in the long run. While Medicaid still spends more total dollars on nursing home care than on home care, nursing facility use by Medicaid-eligible seniors has fallen by nearly one third, from 1.4 million in 1995 to just over 1 million in 2010. The second reason is that seniors’ enrollment in Medicaid is growing very slowly even though the overall older population is growing rapidly. The number of people 65 and older increased by more than 80 percent from 1975 to 2010 and the number of those over 85 (who are most likely to need long-term supports and services) has tripled. Yet, Medicaid enrollment by seniors increased by only 18 percent from 1975-2010. That’s in sharp contrast to younger Medicaid beneficiaries, who have increased by more than 200 percent. A third reason may be that nursing homes themselves would rather provide post-acute and rehabilitation services instead of long-stay care. Why? Medicaid pays an average of only about $125 per day for a long-term care resident, while Medicare pays $500 or $600 per day for a post-acute short-stay patient. As a result, many nursing home operators are shifting beds from long-term care to more lucrative rehab and post-acute.