Senior Living’s Long-Term Care Role Stunted by Funding Limitations

Home- and community-based senior living options are a focal point of the Long-Term Care Commission’s final report to Congress. Not included in the report: a comprehensive solution for how a rapidly aging population will pay for assisted living, home care, and other types of care that are generally privately funded. 

Consumer choice and returning seniors to their communities whenever possible stood out as a top priority of the report to Maureen Hewitt, the president and CEO of InnovAge, a not-for-profit affordable senior services provider with five Medicaid-funded PACE (Program of All-Inclusive Care for the Elderly) centers in Colorado and a sixth in New Mexico. 

What the committee and long-term care providers are tasked with, according to Hewitt, is figuring out how to serve a growing senior population who will want and demand options, amid growing budget pressure. InnovAge’s services include coordinating care for PACE-eligible seniors, which encompasses adult day care programs and in-home care—whether that’s a private residence or an assisted living apartment. 

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“Keeping seniors in familiar surroundings contributes to their overall well-being, and providing those in-home and community-based options are essential,” she says. “The committee’s work is to try to come up with community models that are going to be innovative in order to take care of a very large population of people. Bringing that to the forefront is important; long-term care historically has never been in the forefront.” 

Existing pieces of the long-term care puzzle that are already working well should stay in place, says Hewitt, cautioning that an influx of new pilots and projects should not result in state and federal governments “throwing the baby out with the bathwater” just because a new idea has emerged. 

 “A new approach to senior and long-term care is essential in the face of an aging and diverse population, the rise in chronic conditions, longer life expectancies, the decrease in available caregivers and escalating healthcare costs,” says Hewitt. “However, we have to maintain what works while integrating new approaches.”

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Whether or not new care models stem from the report, their potential viability is already threatened: critics say the report fails to definitively address a looming crisis of how to finance long-term care, and commissioners were divided on whether funding should take a public or private emphasis. 

While “senior living” as a phrase does not appear in the 115-page report, community-based options are frequently referenced and emphasized as more preferred by consumers compared to institutional settings. There are multiple Medicaid programs and pilots experimenting with home- and community-based settings (HCBS), but the report doesn’t recommend diverting public funding to traditionally private-pay senior living settings.

“Assisted living and independent living are very important options in the spectrum, but there are only so many dollars to go around,” says Neil Pruitt Jr., chairman of the American Health Care Association and a Republican-appointed member of the Long-Term Care Commission. “They play an important role, but I don’t see [them] necessarily creating a new entitlement program that’s not [in existence] today.” 

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Long-term supports and services have seen a shift away from institutional care to HCBS, notes the report, which recommends eliminating “the institutional bias in Medicaid LTSS,” but even with the trend toward care settings that generally cost less than nursing homes, state budgets are strained.

“State Medicaid spending overall is putting pressure on state budgets now and is likely to overwhelm both state and federal budgets in the coming decades,” the commissioners say in the forward to the report. 

Currently, Medicaid finances 62% of all paid long-term supports and services, although only about 30% of Medicaid spending goes toward those services, says the report. Half of that pays for nursing home care, while the remainder is for services provided in home and community settings.

Although the current healthcare environment is very challenging, it’s also ripe with opportunity, says Hewitt. 

“It’s a great opportunity for providers who want to be a part of [the changing system], to partner with other providers, and to really be significant in long-term care,” she says of InnovAge. “That’s our plan—we’re partnering with other providers, and we really want to be a part of it.” 

Care coordination will be a huge part of the equation going forward, and InnovAge already has a foot in the door. In addition to its own senior housing community, the InnovAge PACE program contracts with senior living providers. 

The objective, says Hewitt, is to find out how to keep someone living independently in their home, but provide services to them so they don’t have to move to the next level of care. 

“We’re in CCRCs; in senior housing and assisted living. You can see a whole circle of services when you put these two elements together: A safe place to live, wrapped with services. That’s where the opportunity is,” she says. “What our programs have done is figure out how to work with that assisted living provider to wrap additional care that’s needed for these folks to be able to stay in their chosen home.” 


Written by Alyssa Gerace

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