Seniors, disabled could find services impacted by per capita caps

The implementation of per capita caps on Medicaid funding would not account for the disproportionate amount of program spending on certain groups of Medicaid enrollees. The Kaiser Family Foundation’s (KFF) issue brief on state variation in spending, issued in light of the American Health Care Act’s (AHCA) (H.R. 1628) proposed spending limits, notes that although seniors and the disabled make up 23 percent of Medicaid enrollment, 64 percent of program funds are spent on these groups.


Children and nonelderly adults with disabilities account for spending three times greater than their enrollment share, and spending on seniors is slightly more than double their enrollment share. These groups have greater health needs and use more acute care and long-term care services as opposed to those who are enrolled based only on income. Children without disabilities cost an average of $2,463 in 2011, while disabled children cost $16,802. Per enrollee spending on nonelderly adults with disabilities was $3,247, while spending for nonelderly disabled adults was $16,613 and spending for seniors was $13,249.

State programs

Spending also varied widely by state: Tennessee spent $6,945 per disabled child while New Hampshire spent $53,557. Some states spend less than $15,000 on disabled adults and seniors, while others pay $25,000 or more. This disparity stems from various coverage pathways offered to seniors and the disabled either at higher income levels or for some significantly disabled children regardless of parental income, provided at a state’s discretion. Variation in spending levels also depends on how many receive community care versus institutional care, with some states targeting home- and community-based services to those who are at risk of needing institutional care in the future. Other states offer personal care or attendant care services.

The brief pointed out that changing the federal Medicaid payment structure from guaranteed payments to states to a per capita cap could bind states to their current coverage provision, locking in these differences between states. In addition, these caps would not account for spending on newly discovered drugs or treatments, and could hamper state responses to emergency situations such as natural disasters like Hurricane Katrina or issues like the opioid epidemic and the Flint water crisis. States may be forced to cut some services they have chosen to provide under their Medicaid programs due to limit federal funding, such as long-term care services, which could especially impact seniors and the disabled.

Committee hearing takes a long view at long-term care

Proposals to improve the financing and delivery of long-term care (LTC) were considered at a House hearing held by the Energy and Commerce Committee’s Health subcommittee. The subcommittee heard testimony from experts in the field who addressed the need for accessible LTC as Americans are growing older. In addition to addressing the changing demographic problem, the witnesses testified as to new financing strategies, including new models of LTC insurance. Committee chairman Joe Pitts (R-Pa) noted that the hearing was designed to exam the state of the LTC and to find a viable long-term solution.

Status quo

Congresswoman Doris Matsui (D-Calif) noted that the current financing system relies too heavily on the unpaid labor of 52 million individuals who care for their ailing family members or friends. Matsui also noted that the costs of LTC are placing too great a strain on Medicaid, which is the single largest payer of LTC services. She also made clear that under the current system, despite misconceptions to the contrary, Medicare pays for LTC in very limited circumstances.

An insurable risk

William Scanlon, a Consultant at the West Health Institute and National Health Policy Forum and the former managing director of Health Care Issues as the US General Accounting Office, testified that a financing solution based upon efficiencies found in the delivery or payment process is unlikely to succeed. Scanlon testified that insurance is a solution and that LTC makes sense as an insurable risk because the need for LTC services is not a certainty. He noted that “for persons turning 65 between 2015 and 2019, almost half (48 percent) will have zero LTC expenses before they die.” He explained that an individual benefits more from insurance than by saving for LTC expenses because there is a high probability that all or most of the monies saved in anticipation of LTC expenses would remain unused when the individual dies. Despite the advantages, Scanlon testified that only 3 percent of adults and 11 percent of adults over 65 have a private LTC insurance policy.


Alice Rivlin, Co-Chair of the Long-Term Care Initiative at the Bipartisan Policy Center testified as to four proposals to reform the system. One of those ideas, based upon the notion that LTC should be an insurable risk, is to make private LTC insurance more available and accessible. She also recommended the design of a federal LTC insurance option for individuals with catastrophic costs. She encouraged lawmakers to streamline Medicaid home and community-based care options to encourage effective care in lower cost settings. Her final recommendation was to ensure that working people with disabilities do not lose access to LTC services as their earnings increase.

Insurance models

Anne Tumlinson, the CEO of Anne Tumlinson Innovations LLC and Founder of, reiterated the problem of unpaid labor in her testimony, noting that while the U.S. spends $200 billion each year on LTC, the country relies on nearly $500 billion in unpaid family care. To solve the problem, Tumlinson discussed three insurance approaches: comprehensive, front-end, and catastrophic. She explained that each variety of insurance involved certain trade-offs like higher costs and limited coverage. Although she acknowledged that reform would be difficult, Tumlinson told lawmakers “we cannot afford to give up.”