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26 227 19856

(1) Identify and locate elderly eligible individuals for such services;

(2) Plan and manage services to be provided to such individuals;

(3) Educate the public and medical and social service professionals concerning the availability of such services;

(4) Encourage and enhance the participation of families and voluntary organizations in the provision of such services;

(5) Train personnel to provide such services through the use of model curricula which include proper standards and quality assurance mechanisms in such training;

(6) Coordinate long-term-care services provided to elderly individuals by public and private institutions and voluntary organizations in order to eliminate duplication in the provision of such services.

II. HISTORY OF S. 1181

S. 1181, a bill which would establish a program of grants to the States for home and community-based services for elderly individuals, was introduced May 21, 1985, by Senator Hatch and others and referred to the Committee on Labor and Human Resources. This bill had grown out of legislative initiatives begun by Senator Hatch in 1981 to expand the availability of cost-effective home and community-based services.

The block grant approach for enhancing States' abilities to offer cost-effective community-based services to the frail elderly was originally embodied in S. 1539, introduced by Senator Hatch in 1983. This bill was considered in hearings held by the Committee in July 1983 and included in S. 242, the Employment Opportunities Act of 1983, reported by the Committee July 14, 1983.

In 1984, similar provisions were included in S. 2301, the Health Services, Preventive Health Services, and Home and CommunityBased Services Act of 1984. This bill was ordered reported March 21, 1984; however, the Home and Community-Based Services Block Grant provisions were not included in the bill as passed by the Senate.

S. 1181, as introduced by Senator Hatch in 1985, differs from previous versions of this legislation in three principal ways. Its authorization levels have been reduced to $100 million for each of the fiscal years 1987 through 1989. The bill also simplifies the list of activities and services which may be supported under the block. In addition, it clarifies that home and community-based services funded under the block should be targeted on the most frail of elderly persons; that is, those in institutions or at risk of institutionalization. S. 1181 was ordered reported by the Committee, with amendment, November 19, 1985.

III. BACKGROUND

Long-term care encompasses a wide array of services offered in a variety of settings ranging from nursing home and other institutions to adult day care centers and other innovative non-institutional arrangements in the patient's own home. Community-based long-term care typically refers to such noninstitutional services as

UNIVERSITY OF MICHIGAN LIBRARIES

home health care (including part-time skilled nursing care and certain other medically related services); physical, speech, and occupational therapy; social services (including adult day care, counseling, transportation, friendly visiting); nutritional and health education, homemaker, chore, and personal services (including cooking, housekeeping, home maintenance, feeding, and shopping).

Many observers feel that the present system of long-term care in the United States is biased toward institutional care. By and large, publicly financed health programs provide substantially more support for hospital and nursing home care than for home health and other community-based services. This is true, for example, for both the Medicare and Medicaid programs, two of the principal but limited sources of Federal support for home health care services.

Medicare, authorized under Title XVIII of the Social Security Act, is a Federal health insurance program for most persons aged 65 and over, persons, under 65 entitled to Federal disability benefits, and certain individuals with end-stage renal disease. Medicare's coverage for these persons tends to focus on acute care services of a relatively short-term nature. While there is no limit on the number of covered home health visits under the program, such visits are restricted to those persons who are homebound and in need of part-time or intermittent skilled nursing care, or physical or speech therapy, preconditions which generally exclude large numbers of chronically ill persons requiring extended care and a combination of medical-social-personal type services. Medicare's definition of covered home health services also serves to limit the program's usefulness for persons with chronic care needs. The services often cited as most needed to permit an individual to avoid institutionalization-homemaker/chore, home-delivered meals, transportation, and respite care-are the very types of services not convered by Medicare.

Similarly, the Medicaid program contains incentives for institutional, as opposed to home and community-based care, even though the Congress has attempted to reduce the impact of these incentives by including in the Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35) a provision which allows the Secretary of HHS to waive Federal requirements to enable a State to provide home and community-based services to individuals otherwise requiring nursing home services which would be reimbursed by Medicaid.

Medicaid, authorized under Title XIX of the Social Security Act, is a Federal-State matching program providing medical assistance for certain low-income persons. The General Accounting Office (GAO) has observed that Medicaid's eligibility policies and restrictive benefits have created financial incentives to use nursing homes. State Medicaid programs have offered more extensive and often full coverage for long-term care services provided in nursing homes, while support to the chronically impaired living in the community has usually been limited. In addition, certain elderly, ineligible for Medicaid while living in the community, may become eligible once they enter a nursing home, if the State has different income standards for nursing home residents as opposed to community residents. Others become eligible for Medicaid once they deplete their resources after initially entering the nursing home as privately paying patients.

These incentives for institutional care have important implications for that portion of the Nation's gross national product devoted to health care as well as for Federal expenditures requires for long-term care services under various entitlement programs. In 1965, the Nation's total expenditures for nursing home care amounted to $21.1 billion; by 1983, they had increased to $29 billion. These expenditures are expected to reach $67.1 billion by 1990. Of the 1983 total of $29 billion for nursing home care, 50 percent ($140 billion) was paid by public programs. By far the largest portion of public expenditures for nursing home care was funneled through the Medicaid program, a total of $124 billion in 1983. This $12.4 billion represented nearly 43 percent of all spending and 89 percent of public spending for nursing home care in 1983.

In addition, the U.S. population over age 65 will increase markedly in the next 50 years. Today about 12 percent of the Nation's population is over age 65. By the year 2030, the 55 million elderly projected for that time will comprise 22 percent of the total U.S. population. Among the elderly, the proportion of those age 75 plus will increase even faster then those ages 65-74. Today, 38 percent of those age 65 plus are also over age 75; more than 9 percent are age 85 plus. By the year 2030, the age 75 plus group is expected to represent 45 percent and those 85 plus will represent 12 percent of those over 65.

Roughly, 5 percent of the total U.S. population over age 65 are currently residents of nursing homes. But the proportion of those 75 and older in nursing homes is much greater-22 percent of those over age 85 are in nursing homes.

Assuming current utilization rates, estimates show that the number of nursing home residents (currently about 1.3 million) will increase by 54 percent over the next 20 years and by 132 percent― to a level of almost 3 million-by the year 2030. Home and community-based services is a means to lessen these totals and reduce their attendent costs.

IV. COMMITTEE VIEWS

As noted above, S. 1181 is similar to previous legislation considered and reported by the Committee. The Committee's bill establishes within the PHS block authority a separate Home and Community-Based Services Block Grant program to the States. For this block grant, the bill authorizes $100 million for each of the fiscal years 1987 through 1989.

By reporting S. 1181, the Committee emphasizes and affirms its commitment to an approach which is particularly relevant and appropriate at this time. The Committee is well aware that the present system of long-term care in the country is biased toward institutional care and that publicly financed health programs provide substantially more support for hospital and nursing home care than for home health and other community-based services. The Committee is also convinced that home and community-based care can result in significant cost-savings over the longrun for elderly individuals. Unless viable community-based services are developed to prevent unnecessary institutionalization of the elderly, the Nation can only expect that the number of persons in nursing

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