Medicaid funds going directly to people

DES MOINES, Iowa, April 29 (UPI) -- A handful of states are participating in an innovative program that puts Medicaid money directly into the hands of the poor and disabled so they can decide how to manage their own care.

The program -- Cash and Counseling Demonstration -- bypasses the government agencies that usually provide the help and instead gives the funds directly to the needy to pay for such things as cooking and bathing, allowing recipients to hire whomever they wish, including relatives and friends.


The program so far has been tested in Arkansas, Iowa, New Jersey, New York and Florida. New Hampshire and South Carolina are developing a similar program called Independence Plus.

Medicaid is run by the states and covers the poor and disabled. It covers 20 percent of all U.S. children and helps pay for two-thirds of nursing home residents. Some 1.2 million disabled who qualify for home services participate the program. Disabilities include stroke, severe congestive heart failure, spinal cord injuries, brain damage and multiple sclerosis.


Vernon K. Smith, a former Medicaid director in Michigan, tracks Medicaid trends across the country. He said enrollment is growing fastest among families and children but the elderly account for most of the growth in costs, accounting for some 70 percent.

In Iowa, Medicaid costs were $100 million higher than expected last year and costs of the $1.2 billion program are expected to rise another $60 million this year. Under the demonstration project, however, costs remained constant.

Jack Hillyard, director of the employment policy group at the University of Iowa's Center for Disabilities and Development said the program puts the money directly into a person's checking account and allows the recipient to negotiate payment for care.

"The people are in a much more respectful position," Hillyard told the Des Moines Register.

An AARP survey indicated 53 percent of those queried said they would prefer having control over who took care of them and only 15 percent said they preferred going through a state agency.

The study released Tuesday found those with disabilities over the age of 50 who want independence often are thwarted by a lack of affordable options. Further, there's no organized system for delivering services.

"As the influx of (baby) boomers enters their 50s and 60s, they will bring their attitudes of competitive consumerism to healthcare delivery, and will demand greater choice and control of available services," said John Rother, AARP policy and strategy director. Rother noted that while the vast majority of people age 50 or older do not require long-term assistance at any given time, most people will require some help at some point in their lives, and most families will deal with these issues as family members age.


The research group Mathematica Policy Research Inc. -- which has offices in Washington; Cambridge, Mass.; Columbia, Md.; and Princeton, N.J. -- found those participating in the demonstration project loved it, in part because they were able to hire people they trusted.

With the costs of medical care soaring and the number of uninsured growing, states are looking for ways to keep Medicaid costs under control. Nearly every state is considering modifications to Medicaid eligibility requirements or payments to providers this session, according to the National Conference of State Legislatures. A number of governors cited spiraling Medicaid costs as the main culprit in their budget deficits.

Medicaid dates back to 1965 and the beginnings of President Lyndon Johnson's Great Society program. Since 1997, costs have increased 50 percent -- 25 percent in the past two years alone -- to $250 billion annually and enrollment currently is rising at the highest rate in a decade.

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