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services provided under Medicaid have varied considerably from State to State. With the publication of Medicaid regulations on August 25, 1976, all States were required to provide nursing services, home health aide services, and medical supplies and equipment.

Any person eligible for skilled nursing home services, and if home health services were prescribed by a physician, is eligible to receive home health care.

The Medicaid home health care benefits differ from Medicare benefits because they do not require skilled nursing care or physical or speech therapy for a person. Also, they do not provide for medical social services. In contrast to Medicare part A, to be eligible for Medicaid home health care benefits a person does not need prior hospitalization nor is the number of visits limited by Federal law or regulation, although States may impose a limitation.

For fiscal years 1975, 1976, and 1977 total State expenditures were, or were estimated to be, about $73 million, $126 million, and $154 million, respectively, for homehealth care benefits under their Medicaid programs. The Federal share was about $40 million, $71 million, and $87 million, respectively. In contrast, total Federal and State Medicaid expenditures for instititionalized care in skilled nursing and intermediate care facilities were $4.2 billion, $4.7 billion, and $5.8 billion, respectively.

THE TITLE XX PROGRAM

The 1975 Amendments to the Social Security Act encouraged each State, as far as practicable under the conditions in that State, to furnish services directed at the following goals

--achieving or maintaining economic self-support
to prevent, reduce, or eliminate dependency;

--achieving or maintaining self-sufficiency, including reduction or prevention of dependency;

--preventing or remedying neglect, abuse, or exploi-
tation of children and adults unable to protect
their own interests or preserving, rehabilitating,
or reuniting families;

--preventing or reducing inappropriate institutional
care by providing for community-based care, home-based
care, or other forms of less intensive care; or

--securing referral or admission for institutional
care when other forms of care are not appropriate
or providing services to individuals in institutions.

A variety of home-based services--including homemaker, home health aide, home management, personal care, consumer education, and financial counseling services--can be provided under a State's title XX program. Covered services vary from State to State, but according to the States' Comprehensive Annual Services Program plans, at least one home-based service is included in each State program. In fiscal year 1976, the Government provided $284 million of the total title XX $2.5 billion allocation for homebased services.

THE OLDER AMERICANS ACT

The Older Americans Act of 1965 established the Administration on Aging (AOA) in HEW. AOA, which is part of HEW's Office of Human Development, serves as a focal point within the Federal Government on problems for the elderly.

AOA administers or assists in several programs related to home health services, as authorized by the act, for persons age 60 and over. Title III of the act (Grants for State and Community Programs on Aging) authorizes projects to help elderly Americans maintain an independent life-style. Many of the projects contain home health components and other health-related features, including visiting nurses, home health services for the homebound elderly, homemaker services, health education, immunization and screening programs, home repairs, and home delivered meals. Some title III projects train geriatric aides to monitor the health status of the homebound elderly.

Under title IV of the Older Americans Act, research and demonstration projects are funded to develop models or alternatives for living and service delivery arrangements for older Americans who would otherwise require institutionalization.

Title VII (Nutrition Program for the Elderly), should improve the well-being of older persons through nutrition and socialization programs. Meals and supportive services are provided in congregate settings, as well as in the home.

PUBLIC HEALTH SERVICE ACTIVITIES

HEW also supports home health services through the efforts of the Public Health Service (PHS). PHS administers home health agency developmental and expansion activities authorized by Public Law 94-63, the Special Health Revenue Sharing Act of 1975. The $3 million appropriated under Public Law 94-63 in fiscal year 1976 has been allocated to start or expand 15 developmental and 40 expansion projects in areas where they were either unavailable or insufficient for the areas' needs. Public Law 94-460, enacted on October 8, 1976, extended the home health grant program through fiscal year 1977.

In addition, PHS is conducting research authorized by section 222 of the 1972 Amendments to the Social Security Act. Demonstration projects funded under section 222 should determine the cost-effectiveness of day care and homemaker services, as well as comprehensive community-based services programs, as alternatives to inappropriate institutionalization.

SCOPE OF REVIEW

Our work was done principally at SRS and SSA headquarters and their regional offices in Atlanta, Georgia, and San Francisco, California. In addition, we visited intermediaries, home health agencies, and States' Departments of Health in California, Florida, and Georgia.

We reviewed pertinent Federal and State laws and regulations, agency records, and data on demonstration and research projects which dealt with home health care.

We also developed data on the comparative costs of institutionalization and home care for elderly persons in Cleveland, Ohio. The data base and methodology used for this comparison is discussed in detail in the following chapter.

CHAPTER 2

COSTS OF HOME SERVICES COMPARED

TO INSTITUTIONALIZATION

About 60 percent of the elderly who are extremely impaired live outside of institutions. However, these people receive a wide array of in-home services such as personal care, meal preparation, nursing care, homemaker service, and continuous supervision. Other services are transportation, housing, and social and recreational. Because all these services help to maintain a person in his home, they are called, for simplicity, "home services." These home services are combined with each other to help sustain health, activity, and independence. The combination of services and frequency of each service varies depending on the level of impairment of the individual.

At all levels of impairment, the value of services provided by families and friends greatly exceeded that cost of services provided by public agencies at public expense. The total cost of these home services becomes greater than the cost of institutionalization for older people who are greatly or extremely impaired. About 17 percent of those 65 or over fall into these categories.

We examined the relationships between people in Cleveland at different levels of impairment, the services they received, and how these services were delivered. Our analysis showed:

--As expected, people who are more impaired receive
more services than people who are less impaired.

--Public agencies are currently spending less per person for home services than is spent for institutional care regardless of the levels of impairment.

--Eighty-seven percent of older people institutionalized are greatly or extremely impaired compared to 14 percent of those at home.

--Care provided to the greatly or extremely impaired
living at home is similar to institutional care.

--Family and friends provide over 50 percent of the
services received by older persons at all impair-
ment levels and over 70 percent of the services
received by the greatly or extremely impaired.

The cost of the services that older people received in Cleveland should not be considered indicative of what expenditures would be if a comprehensive federally funded program was established to provide home-care services for older people--partially because our analysis was based on services actually received as opposed to services which might be considered as necessary and thus reimbursable under some structured criteria.

Our report, "The Well-being of Older People in Cleveland, Ohio" (HRD-77-70, Apr. 19, 1977), showed that some people did not use services because the services were not available in certain areas of Cleveland or people were not aware of the availability of services.

If Federal funding were increased, more services would become available and their availability would probably be better publicized, resulting in increased use. Also, the availability of services at public expense could result in less services being provided by families, friends, and charitable organizations.

To assist in understanding our analysis, we divided this chapter into the following three sections:

--The methodology section shows how we did our analysis.
--The cost comparison section shows how we determined
if the cost of maintaining a person in a home
equals that of maintaining a person in an institution.

--The families and friends section shows the signifi-
cant role they play in supporting an older person
in the community.

METHODOLOGY

The information contained in this chapter is based on an extensive data base developed in our review of the wellbeing of older people in Cleveland, Ohio.

This data base contains information on the characteristics of 1,609 people 65 years and over sampled from the Cleveland population. The dominant characterisitics of those

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