Long-Term Care: Implications of Supreme Court's Olmstead Decision
Are Still Unfolding (24-SEP-01, GAO-01-1167T).
In the Olmstead case, the Supreme Court decided that states were
violating title II of the Americans with Disabilities Act of 1990
(ADA) if they provided care to disabled people in institutional
settings when they could be a appropriately served in a home or
community-based setting. Considerable attention has focused on
the decision's implications for Medicaid, the dominant public
program supporting long-term care institutional, home, and
community-based services. Although Medicaid spending for home and
community-based service is growing, these are largely optional
benefits that states may or may not choose to offer, and states
vary widely in the degree to which they cover them. The
implications of the Olmstead decision--in terms of the scope and
the nature of states' obligation to provide home and
community-based long-term care services--are still unfolding.
Although the Supreme Court ruled that providing care in
institutional settings may violate the ADA, it also recognized
that there are limits to what states can do, given the available
resources and the obligation to provide a range of services for
disabled people. The decision left many open questions for states
and lower courts to resolve. State programs also may be
influenced over time as dozens of lawsuits and hundreds of formal
complaints seeking access to appropriate services are resolved.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-01-1167T
ACCNO: A02001
TITLE: Long-Term Care: Implications of Supreme Court's Olmstead
Decision Are Still Unfolding
DATE: 09/24/2001
SUBJECT: Aid for the disabled
Civil rights law enforcement
Health care facilities
Home health care services
Long-term care
Medicaid Program
Olmstead
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GAO-01-1167T
Testimony Before the Special Committee on Aging, U. S. Senate
United States General Accounting Office
GAO For Release on Delivery Expected at 1: 00 p. m. Monday, September 24,
2001 LONG- TERM CARE
Implications of Supreme Court?s Olmstead Decision Are Still Unfolding
Statement of Kathryn G. Allen Director, Health Care- Medicaid
and Private Health Insurance Issues
GAO- 01- 1167T
Page 1 GAO- 01- 1167T
Mr. Chairman and Members of the Committee: I am pleased to be here today as
you address challenges in providing for long- term care, in view of the
Supreme Court?s 1999 decision, known as Olmstead, that addressed issues
pertaining to the setting in which a person with disabilities receives care.
1 Long- term care includes many types of services that a person with a
physical or mental disability may need, and encompasses a wide array of care
settings. Such care can be provided in institutional settings such as
nursing homes or state psychiatric facilities, or in community settings such
as assisted living facilities, adult foster homes, and people?s own homes.
About 80 percent of the estimated 5.2 million elderly individuals who
require assistance with daily activities 2 live at home or in community-
based settings, while about 20 percent live in nursing homes or in other
institutions. Many people with disabilities who live outside of institutions
rely on home and community- based services such as home health care or
nursing services, assistance with meals or medication management, and
personal care services. Many people with disabilities are elderly adults,
but children and adults of all ages have diverse types of disabilities that
may require long- term care services.
In Olmstead, the Supreme Court decided that states may be violating title II
of the Americans With Disabilities Act of 1990 (ADA) 3 if they provide care
to people with disabilities in institutional settings when they could be
appropriately served in a home or community- based setting. While the
Olmstead decision involved two women with developmental disabilities and
mental illness who were residents of a psychiatric hospital, it has been
interpreted to extend beyond these specific circumstances. This includes
applicability to people with physical as well as mental disabilities, to
those in nursing homes and other institutional settings in addition to
psychiatric hospitals, and to those who live in the community and are at
risk of institutionalization. As a result, the decision has generated
considerable discussion about its implications for the provision of long-
term care services- not only for people with disabilities who currently need
services, but also for the growing numbers of aging baby boomers who
1 Olmstead v. L. C., 527 U. S. 581 (1999). 2 Individuals needing long- term
care may have difficulty performing some activities of daily living (ADL)
without assistance, such as bathing, dressing, toileting, eating, and moving
from one location to another; or instrumental activities of daily living
(IADL) such as preparing food, doing housekeeping, and handling finances; or
both.
3 See 42 U. S. C. sect.sect. 12131- 12165.
Page 2 GAO- 01- 1167T
will need care in the coming decades. In responding to these current and
future long- term care service needs, much attention has been focused on
Medicaid, the joint federal- state health financing program for certain
lowincome individuals, including the elderly and persons with disabilities.
Flexibility built into the Medicaid program allows states to make many of
their own decisions, within broad federal guidelines, about whom and what
long- term care services to cover, and in what settings.
As part of your ongoing series of hearings on long- term care, you asked us
to address the implications of the Olmstead decision in this larger context.
My remarks today, which are based on our current and previous work 4 and on
the research of others, will focus on (1) an overview of the demand for and
financing of long- term care, in view of the Olmstead decision and the
growing numbers of baby boomers, and (2) implications of the decision for
state- administered long- term care programs.
In summary, the extent to which the Olmstead decision will dictate major
shifts in long- term care services from institutional to home and community-
based settings- and for whom- is uncertain. What is more certain, however,
is that responses to the decision will take place in the larger context of
preparing for the tidal wave of aging baby boomers who will increasingly tax
the current capacity of public and private resources. This aging generation,
with the associated expected increase in the numbers of people with
disabilities, could increase the number of disabled elderly people who will
need care to between 2 and 4 times the current number. While many public
programs support people with disabilities, Medicaid is the dominant public
program supporting long- term care institutional and home and community-
based services, accounting for about 44 percent of the $134 billion spent
for these services nationwide in 1999. Historically, Medicaid has financed
long- term care primarily in nursing homes or other institutions. While
Medicaid spending for home and community- based services is growing, these
are largely optional benefits that states may or may not choose to offer,
and states vary widely in the degree to which they cover them as part of
their Medicaid programs. Consequently, the ability of Medicaid- eligible
people with disabilities to access care in home and community- based
settings also varies widely from state to state and even from community to
community. Private resources- which include out- of- pocket spending and
private health and long- term- care insurance- make up the second largest
source of long- term
4 A list of related GAO products is at the end of this statement.
Page 3 GAO- 01- 1167T
care financing, comprising about 40 percent of total spending. This public
and private spending, however, does not quantify the total costs of longterm
care. Families play a major role in supplying services. For example, an
estimated 60 percent of disabled elderly individuals living in communities
rely exclusively on their families and other unpaid sources for their care.
Implications of the Olmstead decision- in terms of the scope and nature of
states? obligation to provide home and community- based long- term care
services- are still unfolding. While the Supreme Court ruled that, under
certain circumstances, providing care in institutional settings may violate
the ADA, it also recognized that there are limits to what states can do,
given available resources and the obligation to provide a range of services
for people with disabilities. The ADA does not require states to
?fundamentally alter? their existing programs. The decision thus left many
open questions for states and lower courts to resolve. To date, most states?
responses to Olmstead have focused on preparing plans that lay out goals and
actions for expanding home and community services for people with
disabilities. The Supreme Court had indicated that such plans were a way for
states to demonstrate they were making reasonable progress in changing their
long- term care programs. Because most of these plans are works in progress,
it is too soon to tell how and when they will be implemented. State programs
also may be influenced over time as dozens of lawsuits and hundreds of
formal complaints seeking access to appropriate services are resolved.
The plaintiffs in the Olmstead case were two women with developmental
disabilities and mental illness who claimed that Georgia was violating title
II of the ADA, which prohibits discrimination against people with
disabilities in the provision of public services. Both women were being
treated as inpatients in a state psychiatric hospital. The women and their
treating physicians agreed that a community- based setting would be
appropriate for their needs. The Supreme Court held that it was
discriminatory for the plaintiffs to remain institutionalized when a
qualified state professional had approved community placement, the women
were not opposed to such a placement, and the state could Background
Page 4 GAO- 01- 1167T
reasonably accommodate the placement, taking into account its resources and
the needs of other state residents with mental disabilities. 5
The Olmstead decision is an interpretation of public entities? obligations
under title II of the ADA. As one of several federal civil rights statutes,
the ADA provides broad nondiscrimination protection for individuals with
disabilities in employment, public services, public accommodations,
transportation, and telecommunications. Specifically, title II of the ADA
applies to public services furnished by governmental agencies and provides
in part that ?no qualified individual with a disability shall, by reason of
such disability, be excluded from participation in or be denied the benefits
of the services, programs, or activities of a public entity, or be subjected
to discrimination by any such entity.? 6
Two ADA implementing regulations were key in the Supreme Court?s ruling in
Olmstead. The first requires that public entities make ?reasonable
modifications? when necessary to avoid discrimination on the basis of
disability, unless the entity can demonstrate that the modification would
?fundamentally alter the nature of the service, program or activity.? 7 The
second requires public entities to provide services in ?the most integrated
setting appropriate to the needs of qualified individuals with
disabilities.? 8 That setting could be in the community, such as a person?s
home, or in an institution, depending on the needs of the individual. For
example, professionals might agree that a nursing home is the most
integrated setting appropriate for an institutionalized person?s needs. In
Olmstead, physicians at the state hospital had determined that services in a
community- based setting were appropriate for the plaintiffs. The Supreme
Court recognized, however, that the appropriate setting for services is
5 527 U. S. 581, 607 (1999). The Supreme Court remanded the case to the
United States District Court for the Northern District of Georgia for
further consideration of whether changes would ?fundamentally alter? the
nature of the services, programs, or activities of the state of Georgia. On
July 11, 2000, the parties settled. Under the settlement agreement, the
state agreed to provide both plaintiffs with community- based residential
placements; individual service plans; and, in the event of
institutionalization, a return to communitybased treatment within 30 days of
a determination that a return to residential or community- based treatment
is appropriate.
6 The ADA defines a public entity as including (1) a state or local
government or (2) a department, agency, special purpose district, or other
instrumentality of a state, states, or local government. 42 U. S. C. sect.12131(
1).
7 28 C. F. R. sect.35. 130( b)( 7). 8 28 C. F. R. sect.35. 130( d).
Page 5 GAO- 01- 1167T
determined on a case- by- case basis and that the state must continue to
provide a range of services for people with different types of disabilities.
The ADA has a broad scope in that it applies to individuals of all
disabilities and ages. The definition of disability under the ADA is a
physical or mental impairment that is serious enough to limit a major life
activity, such as caring for oneself, walking, seeing, hearing, speaking,
breathing, working, performing manual tasks, or learning. 9 The breadth of
this definition thus covers people with very diverse disabilities and needs
for assistance. For some individuals with disabilities, assistance from
another person is necessary- direct, ?hands- on? assistance or supervision
to ensure that everyday activities are performed in a safe, consistent, and
appropriate manner. For others, special equipment or training may enable
them to continue to function independently. Disability may be present from
an early age, as is the case for individuals with mental retardation or
developmental disabilities; occur as the result of a disease or traumatic
injury; or manifest itself as a part of a natural aging process. Moreover,
the assistance needed depends on the type of disability. For example,
individuals with physical disabilities often require significant help with
daily activities of self- care. In contrast, individuals with Alzheimer?s
disease or chronic mental illness may be able to perform everyday tasks and
may need supervision rather than hands- on assistance. To be a
?qualified? individual with a disability under title II of the ADA, the
person must meet the eligibility requirements for receipt of services from a
public entity or for participation in a public program, activity, or
service- such as the income and asset limitations established for
eligibility in the Medicaid program. 10
9 Specifically, the ADA defines ?disability? as (1) a physical or mental
impairment that substantially limits one or more of an individual?s major
life activities, (2) a record of such an impairment, or (3) being regarded
as having such an impairment. 42 U. S. C. sect.12102( 2).
10 States impose specific standards regarding who is sufficiently disabled
to qualify for publicly funded long- term care. Only a subset of the
population considered to be disabled within the meaning of the ADA may be
affected by state long- term care programs targeted to people with extensive
service needs.
Page 6 GAO- 01- 1167T
The breadth of the disabled population to whom Olmstead may eventually apply
is uncertain. Much is unknown about the widely varying population of people
with disabilities, the settings in which they are receiving services, and
the extent to which their conditions would put them at risk of
institutionalization. Demographic data show, however, that the response to
Olmstead will take place in the context of significant increases in the
number of people with disabilities. As the baby boom generation grows older,
they are more likely to be affected by disabling conditions. Of the many
public programs that support people with disabilities, the federal- state
Medicaid program plays the most dominant role for supporting long- term care
needs. Services through this program have been provided primarily in
institutional long- term care settings, but a growing proportion of Medicaid
long- term care expenses in the past decade has been for home and community-
based services. At present, however, there are wide differences between
states in the degree to which home and community- based services are
provided. States also face varying challenges in supporting community living
beyond what can be provided through long- term care programs, such as
ensuring adequate supports for housing and transportation, and maintaining
adequate programs to ensure quality care is provided in community settings.
The Olmstead decision has been widely interpreted to apply to people with
varying types of disabilities who are either in institutions or at risk of
institutionalization. One reason for the uncertainty about how many may be
affected is that, as the decision recognized, the appropriateness of a
person?s being placed in an institution or receiving home or communitybased
services would depend in part on the person?s wishes and the recommendations
of his or her treatment professionals. Another reason is that information on
the number of people with disabilities who are at risk of
institutionalization is difficult to establish.
Number of institutionalized individuals. On the basis of information from
different sources, we estimate that the total number of people with
disabilities who are being served in different types of institutional
settings is at least 1. 8 million. This figure includes about 1.6 million
people in nursing facilities, 11 106,000 in institutions for the mentally
retarded or
11 We earlier reported that approximately 1.6 million elderly and disabled
residents were in nursing facilities in 1999. Nursing Homes: Complaint
Investigation Processes Often Inadequate to Protect Residents (GAO/ HEHS-
99- 80, Mar. 22, 1999), p. 1. Breadth of Population
Affected by Olmstead Is Uncertain but Likely to Grow, With Medicaid the
Dominant Payer
Comprehensive Information on Those Institutionalized or at Risk Is Lacking
Page 7 GAO- 01- 1167T
developmentally disabled, 12 and 57,000 in state and county facilities for
the mentally ill. 13
Number at risk of institutionalization. The number of people who are
living in the community but at risk of institutionalization is difficult to
establish. In an earlier study we estimated that, nationwide, 2.3 million
adults of all ages lived in home or community- based settings and required
considerable help from another person to perform two or more self- care
activities. 14 More difficult to estimate is the number of disabled children
at risk of institutionalization. 15
The demographics associated with the increasing number of aging baby boomers
will likely drive the increased demand for services in a wide range of long-
term care settings. Although a chronic physical or mental disability may
occur at any age, the older an individual becomes, the more likely a person
will develop disabling conditions. For example, less than 4 percent of
children under 15 years old have a severe disability, compared with 58
percent of those 80 years and older. The baby boom generation- those born
between 1946 and 1964- will contribute significantly to the growth in the
number of elderly individuals with disabilities who need long- term care and
to the amount of resources required to pay for it. The oldest baby boomers,
now in their fifties, will turn 65 in 2011. In 2000, about 13 percent of our
nation?s population was composed of individuals
12 David L. Braddock, unpublished data for 2000 from the State of the States
Developmental Disabilities Project, Coleman Institute for Cognitive
Disabilities and the Department of Psychiatry, University of Colorado. In
surveys of state programs for people with developmental disabilities,
Braddock identified nearly 35, 000 people with developmental disabilities
living in nursing facilities in addition to the 106,000 in state and private
Intermediate Care Facilities for persons with Mental Retardation (ICF/ MR)
with seven or more beds.
13 Additions and Resident Patients at End of Year, State and County Mental
Hospitals by Age and Diagnosis by State, United States 1998 (Rockville, Md.:
SAMHSA, Center for Mental Health Services, 2000). See also David L.
Braddock, Public Financial Support for Disability at the Close of the 20th
Century, Coleman Institute for Cognitive Disabilities and Department of
Psychiatry (Denver, Colo.: University of Colorado, Aug. 1, 2001). 14 Since
there is no consensus on what constitutes a severe disability, we estimated,
using National Health Interview Survey data, the number of adults who had
either a lot of difficulty with or was unable to perform either three or
more ADLs or two ADLs and four IADLs. See Adults With Severe Disabilities:
Federal and State Approaches for Personal Care and Other Services (GAO/
HEHS- 99- 101, May 14, 1999).
15 See Children With Disabilities: Medicaid Can Offer Important Benefits and
Services (GAO/ T- HEHS- 00- 152, July 12, 2000). Changing Demographics
Will Drive Increased Demand for Long- Term Care
Page 8 GAO- 01- 1167T
aged 65 or older. By 2020, that percentage will increase by nearly one-
third to about 17 percent- one in six Americans- and will represent nearly
20 million more seniors than there are today. By 2040, the number of seniors
aged 85 and older will more than triple to 14 million (see fig. 1). However,
because older people are healthier now than in the past, no consensus exists
on the extent to which the growing elderly population will increase the
number of disabled elderly people needing long- term care. Projections of
the number of disabled elderly individuals who will need care range between
2 and 4 times the current number.
Figure 1: Estimated Number of Elderly Individuals in 2000, 2020, and 2040
Source: Bureau of the Census, ?Projections of the Total Resident Population
by 5- Year Age Groups and Sex With Special Age Categories: Middle Series,?
selected years, 2000 to 2040 (Washington, D. C.: Jan. 2000).
0 10
20 30
40 50
60 70
80 In millions
4.3 6.8
14.3 62.9
47.0 30.5
2000 2020 2040
Aged 85+ Aged 65 to 84
Years
Page 9 GAO- 01- 1167T
The changing demographics will also likely affect the demand for paid long-
term care services. An estimated 60 percent of the disabled elderly living
in communities now rely exclusively on their families and other unpaid
sources for their care. Because of factors such as the greater geographic
dispersion of families and the large and growing percentage of women who
work outside the home, many baby boomers may have no option but to rely on
paid long- term care providers. A smaller proportion of this generation in
the future may have a spouse or adult children to provide unpaid care and
therefore may have to rely on more formal or public services.
Medicaid is by far the largest public program supporting long- term care. 16
States administer this joint federal- state health financing program for
lowincome people within broad federal requirements and with oversight from
the Centers for Medicare and Medicaid Services (CMS), 17 the agency that
administers the program at the federal level. 18 In 2000, Medicaid long-
term care expenditures represented over one- third of the total $194 billion
spent by Medicaid for all medical services. Although at least 70 different
federal programs provide assistance to individuals with disabilities at
substantial cost, Medicaid is the most significant source of federal funds
16 People with disabilities generally become eligible for Medicaid through
one of two routes. First, individuals become eligible if they meet a state?s
income and resource criteria for institutional care and are determined to
require services equivalent to a nursing home level of care. This is how the
elderly most often become eligible for Medicaid. The second route is through
eligibility for the Social Security Administration?s Supplemental Security
Income (SSI) program. SSI is the federally- administered means- tested
income assistance program that provides a financial safety net for disabled,
blind, or aged individuals who have low incomes and limited resources. As of
October 2000, 40 states provided Medicaid to all individuals who were
receiving SSI payments. In the remaining states, a disabled individual?s
Medicaid eligibility was not automatic since these states have elected to
continue using the SSI standards that were in effect on January 1, 1972, and
are more restrictive than current SSI eligibility criteria.
17 Formerly the Health Care Financing Administration (HCFA), until June
2001. We continue to refer to HCFA where agency actions were taken under its
former name. 18 Medicaid costs are shared by the federal government and
states, and each state program?s federal and state funding shares are
determined through a statutory matching formula. The federal share of
states? medical assistance payments ranges from 50 to 83 percent, depending
on a state?s per capita income in relationship to the national average. On
average, the federal share of Medicaid expenditures is 57 percent. Medicaid
Plays a Dominant
Role in Financing LongTerm Care
Page 10 GAO- 01- 1167T
for providing long- term care. 19 Earlier this year, we reported that
Medicaid paid nearly 44 percent of the $134 billion spent nationwide for
long- term care in 1999, including postacute and chronic care in nursing
homes and home and community- based care. Individuals needing care, and
their families, paid for almost 25 percent of these expenditures out- of-
pocket. Medicare and other public programs covered almost 17 percent, and
private insurance and other private sources (including long- term care
insurance as well as services paid by traditional health insurance)
accounted for the remaining 15 percent. (See fig. 2.) These amounts,
however, do not include the many hidden costs of long- term care. For
example, they do not include wages lost when an unpaid family caregiver
takes time off from work to provide assistance. 20
19 Federal programs supporting people with disabilities can be categorized
generally into two groups. The first group is programs with disability as a
central eligibility criterion, composed of 30 programs largely providing
cash benefits, with estimated expenditures totaling $110 billion in fiscal
year 1999. The second group uses disability as one of many potential
criteria for program participation and consists of 40 programs, including
Medicaid, for which age, income, or both also serve as bases for
eligibility. See Adults With Severe Disabilities: Federal and State
Approaches for Personal Care and Other Services (GAO/ HEHS- 99- 101, May 14,
1999).
20 See Long- Term Care: Baby Boom Generation Increases Challenge of
Financing Needed Services (GAO- 01- 563T, Mar. 27, 2001).
Page 11 GAO- 01- 1167T
Figure 2: Percentage of Expenditures for Long- Term Care, by Source of
Payment, 1999
Note: Includes Medicaid expenditures for home and community- based services,
which are considered as part of ?other personal health care? in HCFA?s
national health care accounts.
Source: HHS, HCFA, Office of the Actuary, National Health Statistics Group,
Personal Health Care Expenditures, 2001.
Historically, Medicaid long- term care expenditures have financed services
delivered in nursing homes or other institutions, but the proportion of
spending directed to home and community- based care has increased steadily
over the past decade, as shown in figure 3. Federal and state Medicaid
spending on home and community- based services was about $18 billion (27
percent) of the $68 billion spent on long- term care in fiscal year 2000.
Medicaid Funding for
Home and CommunityBased Services Is Increasing
2.9% 4.6%
10.3% 13.7%
24.6% 43.8%
Other public Other private
Private insurance Medicare Out- of- pocket Medicaid
Page 12 GAO- 01- 1167T
Figure 3: Trends in Medicaid Long- Term Care Spending for Institutional and
Home and Community- Based Care, 1990- 2000
Source: The MEDSTAT Group, from HCFA 64 Data.
Much of the Medicaid coverage of home and community- based services is at
each state?s discretion. One type of coverage, however, is not optional:
states are required to cover home health services for medically necessary
care (see table 1). A second type of services, called personal care, is
optional. The primary means by which states provide home and community-
based services is through another optional approach: home and community-
based services (HCBS) waivers, which are set forth at section 1915( c) of
the Social Security Act. 21 States apply to the federal government for these
waivers, which, if approved, allow states to limit the availability of
services geographically, target specific populations or conditions, control
the number of individuals served, and cap overall expenditures. 22 To
receive such a waiver, states must demonstrate that the cost of the services
to be provided under a waiver (plus other state
21 These waivers are codified at 42 U. S. C. sect.1396n( c). 22 Provisions of
the Medicaid statute that may be waived include (1) ?statewideness,? which
requires that the services be available throughout the state (a waiver
allows services to be provided only in particular geographic locations); (2)
comparability, which requires that all services be available to all eligible
individuals (a waiver allows states to limit services to a specific number
of individuals on the basis of certain criteria determined by the state,
such as disease, condition, and age); and (3) the community income and
resource rules for the medically needy (a waiver allows states to use
institutional eligibility rules- which are more generous than community
rules- for individuals residing in the community). For more information on
these and other types of home and community services, see Adults With Severe
Disabilities: Federal and State Approaches for Personal Care and Other
Services (GAO/ HEHS- 99- 101, May 14, 1999).
2000
Total spending: $67.7 billion 1990
Total spending: $29.5 billion $3.9 billion
$18.2 billion
$25.6 billion
$49.5 billion Community- based
care Institutional
care
Page 13 GAO- 01- 1167T
Medicaid services) is no more than what would have been spent on
institutional care (plus any other Medicaid services provided to
institutionalized individuals). States often operate several different
waivers serving different population groups, and they have often limited the
size and scope of the waivers to help target their Medicaid resources and
control spending.
Table 1: Expenditures for Home and Community- Based Services Covered by
Medicaid, by Type, Fiscal Year 2000
Dollars in billions Type of service Required or
optional Description Medicaid expenditures
Home Health Care Required Home health care includes
medically necessary nursing, home health aides, medical supplies, medical
equipment and appliances suitable for use in the home.
$2.3 Personal Care Services Optional Personal care services include a
range of assistance to enable people to accomplish tasks they would normally
do for themselves if they did not have a disability. Types of assistance
that may be provided may include light housework, laundry, meal preparation,
transportation, grocery shopping, using the telephone, medication
management, and money management.
$3.8 Home and CommunityBased Services (HCBS) Waivers
Optional HCBS provided under what is called the 1915( c) waiver program
includes a broad range of services such as case management, homemaker, home
health aide, personal care, adult day health, respite care, and, for
individuals with chronic mental illness, outpatient clinic services.
$12.0 Source: HCFA.
While expenditures for these services have generally grown over time,
states? use of HCBS waivers to provide services in community settings has
grown at the highest rate. Expenditures for services provided under HCBS
waivers grew at an average annual rate of 28 percent between 1988 and 2000-
twice as much as Medicaid?s expenditures for home health services and three
times as much as for personal care services.
Page 14 GAO- 01- 1167T
Expenditures under the HCBS waivers vary widely with the type of disability
covered. The average cost across all programs in 1999 was about $15,331 per
recipient. For persons with developmental disabilities, the average cost was
twice the average ($ 30,421); for programs serving the aged and aged
disabled, the average cost was much lower ($ 5,849). This variation results
from several factors, but primarily from differences in the type and amount
of program services supplied versus services from other sources such as
family members. The average costs for providing waiver and other home and
community- based services is much lower than average costs for
institutionalizing a person. However, the costs of these community- based
services do not include significant other costs that must be covered when a
person lives in his or her home or in a communitybased setting, such as
costs for housing, meals, and transportation, as well as the additional
costs and burden for family and other informal caregivers.
The proportion of Medicaid long- term care spending devoted to home and
community- based services varies widely among states. Some states have taken
advantage of Medicaid HCBS waivers to develop extensive home and community-
based services, while other states have traditionally relied more heavily on
institutional and nursing facility services. This variation is reflected in
differences in the extent of states? total Medicaid long- term care spending
devoted to home and community- based care (defined to include the waivers,
home health, and personal care services). For example, in 1999, 9 states
devoted 40 percent or more of Medicaid longterm care expenditures to
community- based care, whereas 11 states and the District of Columbia
devoted less than 20 percent. (See fig. 4.) Provision of Home and
Community- Based Services Varies Widely by State
Page 15 GAO- 01- 1167T
Figure 4: Proportion of Medicaid Long- Term Care Spending for Home and
Community- Based Care, by State, 1999
Source: Based on data from the National Conference of State Legislatures.
States also vary in the amount of home and community- based services they
offer specifically through HCBS waivers. According to data compiled by
researchers, an estimated 688,000 disabled persons were being served under
212 HCBS waivers in 49 states (excluding Arizona) and the District of
Columbia in 1999. 23 (See app. I.) These waivers covered several different
types of disabled populations and settings. All but two states operated at
least one waiver covering services for people with mental retardation or
developmental disabilities, and all but the District of Columbia operated at
23 Charlene Harrington and Martin Kitchener, Medicaid 1915( c) Home and
Community Based Waivers: Program Data, 1992- 1999, prepared for The Kaiser
Commission on Medicaid and the Uninsured (San Francisco, Calif.: University
of California, San Francisco, Aug. 2001).
California Oregon
Washington Idaho Nevada
Montana Wyoming Utah
Arizona a Alaska
Alabama Michigan
Illinois Ohio
Pennsylvania New Jersey Connecticut
Rhode Island Vermont
New Hampshire Maine
Massachusetts Maryland Washington D. C.
Delaware New York
West Virginia Virginia
North Carolina
South Carolina
Georgia Florida Kentucky
Tennessee Mississippi Wisconsin
Indiana Colorado
North Dakota South Dakota
Nebraska Kansas
Oklahoma Texas Hawaii
Minnesota Iowa
Missouri Arkansas Louisiana New Mexico
40 percent or more (9 states) 20 percent to 39 percent (30 states) Less than
20 percent (11 states and the District of Columbia)
Proportion of Medicaid long- term care spending
Page 16 GAO- 01- 1167T
least one waiver for the aged disabled. Overall, states had 73 waivers
covering services for people with mental retardation or developmental
disabilities serving nearly 260,000 participants, 65 waivers covering
services for almost 382,000 aged or aged disabled participants, and 27
waivers serving about 25,000 physically disabled individuals. 24 Nationwide,
the number of people served by waivers varies substantially across states.
Oregon, for example, served more than 8 times as many people per capita in
its large waiver for the aged and disabled, compared with several other
states that had waivers for the same target population.
In most states, the demand for HCBS waiver services has exceeded what is
available and has resulted in waiting lists. 25 Waiting list data, however,
are incomplete and inconsistent. States are not required to keep waiting
lists, and not all do so. Among states that keep waiting lists, criteria for
inclusion on the lists vary. In one 1998- 99 telephone survey of 50 states
and the District of Columbia, Medicaid officials in 42 states reported
waiting lists for one or more of their waivers, although they often lacked
exact numbers. Officials in only eight states reported that they considered
their waiver capacity and funding to be adequate and that they did not have
waiting lists for persons eligible for services under those waivers. 26
The states face a number of challenges in providing services to support
people with disabilities living in the community, and these challenges
extend beyond what can be provided by the Medicaid program alone. The
additional costs to the states of supporting people with disabilities in the
community are a concern. For example, Medicaid does not pay for housing or
meals for individuals who are receiving long- term care services in their
own homes or in a community setting, such as an adult foster home.
Consequently, a number of state agencies may need to coordinate the delivery
and funding of such costly supports as housing and
24 The remaining waivers served almost 22,000 individuals with AIDS,
traumatic brain injuries, and children with severe medical disabilities. 25
Waiting lists can result when states are providing services for the full
number of participants or ?slots? authorized by the waiver agreement with
CMS. States may apply to CMS to amend their waivers to expand the number of
authorized slots. However, waivers also allow states to cap overall
expenditures, which my contribute to waiting lists.
26 Charlene Harrington and others, ?Met and Unmet Need for Medicaid Home and
Community Based Services in the States ,? University of California, San
Francisco, March 2001. This unpublished report has been accepted for
publication in a forthcoming issue of the Journal of Applied Gerontology.
States Face Challenges in
Supporting Community Living
Page 17 GAO- 01- 1167T
transportation. States may also find their efforts to move people out of
institutions complicated by the scarcity of caregivers- both paid personal
attendants and unpaid family members and friends- who are needed to provide
the home and community services.
Finally, there are concerns about the difficulty of establishing adequate
programs to ensure that quality care is being provided in the different
types of noninstitutional service settings throughout the community. We have
reported on quality- of- care and consumer protection issues in assisted
living facilities, an increasingly popular long- term care option in the
community. States have the primary responsibility for the oversight of care
furnished in assisted living facilities, and they generally approach this
responsibility through state licensing requirements and routine compliance
inspections. However, the licensing standards, as well as the frequency and
content of the periodic inspections, are not uniform across the states. In
our sample of more that 750 assisted living facilities in four states, the
states cited more than 25 percent of the facilities for five or more
quality- of- care or consumer protection problems during 1996 and 1997.
Frequently identified problems included facilities providing inadequate or
insufficient care to residents; having insufficient, unqualified, and
untrained staff; and failing to provide residents appropriate medications or
storing medications improperly. State officials attributed most of the
common problems identified in assisted living facilities to insufficient
staffing and inadequate training, exacerbated by high staff turnover and low
pay for caregiver staff. 27
The Supreme Court?s Olmstead decision left open questions about the extent
to which states could be required to restructure their current longterm care
programs for people with disabilities to ensure that care is provided in the
most integrated setting appropriate for each person?s circumstances.
Interpretation of the Olmstead decision is an ongoing process. While the
Supreme Court held in Olmstead that institutionalization of people with
disabilities is discrimination under the ADA under certain circumstances, it
also recognized that there are limits to what states can do, given available
resources and the obligation to provide a range of services for people with
disabilities. Most states are
27 Assisted Living: Quality- of- Care and Consumer Protection Issues (GAO/
T- HEHS- 99- 111, Apr. 26, 1999). See also Assisted Living: Quality- of-
Care and Consumer Protection Issues in Four States (GAO/ HEHS- 99- 27, Apr.
26, 1999). Full Implications of
Olmstead for State Programs Not Yet Known
Page 18 GAO- 01- 1167T
responding to the decision by developing plans for how they will serve
people with disabilities in less restrictive settings. These plans are works
in progress, however, and it is too soon to tell how and when they may be
implemented. State responses will also be shaped over time by the resolution
of the many pending lawsuits and formal complaints that have been filed
against them and others.
The Supreme Court held that states may be required to serve people with
disabilities in community settings when such placements can be reasonably
accommodated. However, it recognized that states? obligations to provide
services are not boundless. 28 Specifically, the Court emphasized that while
the ADA?s implementing regulations require reasonable modifications by the
state to avoid discrimination against the disabled, those regulations also
allow a state to resist requested modifications if they would entail a
?fundamental alteration? of the state?s existing services and programs.
The Court provided some guidance for determining whether accommodations
sought by plaintiffs constitute a reasonable modification or a fundamental
alteration of an existing program, which would not be required under the
ADA. The Court directed that such a determination should include
consideration of the resources of the state, the cost of providing
community- based care to the plaintiffs, the range of services the state
provides to others with disabilities, and the state?s obligation to provide
those services equitably. 29 The Court suggested that if a state were to
?demonstrate that it had a comprehensive, effectively working plan for
placing qualified persons with mental disabilities in less restrictive
settings, and a waiting list that moved at a reasonable pace not controlled
by the state?s endeavors to keep its institutions fully populated, the
reasonable modification standard would be met.? 30
The single most concrete state response to the Olmstead decision has been to
develop plans that demonstrate how the states propose to serve people with
disabilities in less restrictive settings, as suggested by the
28 527 U. S. 581, 603 (1999). 29 527 U. S. 581, 597 (1999). 30 527 U. S.
581, 605- 606 (1999). The Supreme Court
Recognized Limitations to State Obligations
Most States Are Preparing Olmstead Plans
Page 19 GAO- 01- 1167T
Supreme Court. HCFA provided early guidance and technical assistance to
states in these efforts. But most of these state plans are still works in
progress, and it is too soon to tell how and when they will be implemented.
To help states with their Olmstead planning activities, between January and
July 2000 , HCFA issued general guidance to the states in developing
?comprehensive, effectively working plans? to ensure that individuals with
disabilities receive services in the most integrated setting appropriate. 31
To encourage states to design and implement improvements in their community-
based long- term care services, HCFA also announced a set of competitive
grant initiatives, funded at nearly $70 million, to be awarded by October 1,
2001. (See app. II for details about these competitive grants.) In addition,
HCFA made $50,000 starter grants available to each of the states and
territories, with no financial match required, to assist their initial
planning efforts. As of July 2001, 49 states (every state except Arizona)
had applied for and received these starter grants, which must be used to
obtain consumer input and improve services. 32
As of September 2001, an estimated 40 states and the District of Columbia
had task forces or commissions that were addressing Olmstead issues.
According to the National Conference of State Legislatures (NCSL), which is
tracking the states? efforts, the goal for most of these states was to
complete initial plans by the end of this year or early 2002. Ten states
were not developing Olmstead plans, for a variety of reasons. NCSL reported
that some of the states that were not planning already have relatively
extensive home and community care programs and may believe that such
planning is not necessary. As the result of a 1999 lawsuit settlement, for
example, Oregon had developed a 6- year plan to eliminate the waiting list
31 The guidance for developing Olmstead plans included the following
recommendations: involving individuals with disabilities and their
representatives in the planning process, addressing the need to identify
individuals who are eligible for community services, assessing the
appropriateness and capacity (including waiting lists) of available
community- based services, offering individuals with disabilities choices
among services, and taking steps to ensure quality assurance in community
services. HHS? Office for Civil Rights (OCR) also provides technical
assistance to the states on planning issues. For example, states may choose
to submit their draft Olmstead plans to OCR for review and assistance.
According to officials, OCR does not approve or disapprove the plans, but
the office assesses the extent to which the plans address the concerns
raised in complaints.
32 CMS also funds a contractor to maintain the Olmstead National Technical
Assistance Center. The contractor operates a Web site to facilitate
communication between states and consumers and provides research and
summaries on HCBS programs and initiatives.
Page 20 GAO- 01- 1167T
of more than 5,000 people for its waiver program serving people with
developmental disabilities. Moreover, Oregon was the only state to dedicate
more than half of its 1999 Medicaid long- term care spending to home and
community- based services. Vermont also is not working on an Olmstead plan
because it has implemented a range of activities over the years that are
related to downsizing institutions and moving toward home and community-
based care. 33
On the basis of a preliminary review of about 14 draft Olmstead plans, NCSL
reported that the contents are quite variable. A few plans are relatively
extensive and well documented, including determinations of need, inventories
of available services, funding needs, and roadmaps for what needs to be
done. According to NCSL, other plans consist primarily of lists of
recommendations to the governor or state legislature, without specifying how
the recommendations are to be implemented, by which agencies, or in what
time frame.
It is too early to tell how or when the states will implement the steps they
propose in their Olmstead plans. On the basis of the information collected
by NCSL, it appears that few states have passed legislation relating to
Olmstead- for example, appropriating funding to expand community residential
options or authorizing program changes. As of July 2001, NCSL was able to
identify 15 Olmstead- related bills that were considered in eight states
during 2001, of which 4 were enacted. One bill simply provided for
development of the state plan, while others appropriated funding, required a
new home and community- based attendant services program, or proposed long-
term care reforms. Increased state legislative activity is expected in 2002,
as more Olmstead plans are completed.
State responses to Olmstead also will be influenced by the resolution of the
numerous lawsuits and formal complaints that have been filed and are still
pending. Olmstead- related lawsuits, now being considered in almost half the
states, often seek specific Medicaid services to meet the needs of people
with disabilities. Lawsuits on behalf of people with disabilities seeking
Medicaid and other services in community- based settings often are initiated
by advocacy organizations. According to the National
33 According to NCSL, states not developing Olmstead plans were Michigan,
Minnesota, Nebraska, New York, Oregon, Rhode Island, South Dakota,
Tennessee, Vermont, and Virginia. Resolution of Pending
Lawsuits and Complaints Will Help Establish Olmstead?s Reach
Page 21 GAO- 01- 1167T
Association of Protection and Advocacy Systems (NAPAS), Protection and
Advocacy Organizations report that about 30 relevant cases concerning access
to publicly funded health services whose resolution may relate to Olmstead
are still active. 34 Plaintiffs in the cases include residents of state
psychiatric facilities, developmental disabilities centers, and nursing
homes, as well as people living in the community who are at risk of
institutionalization. Their complaints raise such issues as prompt access to
community- based services, the limitations of Medicaid waiver programs, and
the need for assessments to determine the most integrated setting
appropriate to each individual.
It is difficult to predict the overall outcome of these active cases since
each involves highly individual circumstances, including the nature of the
plaintiffs? concerns and each state?s unique Medicaid program structure and
funding. According to a NAPAS representative, two recent cases in Hawaii and
Louisiana illustrate some of the issues raised by Olmsteadrelated lawsuits
and how they were resolved through voluntary settlements.
The Hawaii case 35 shows how one federal court addressed the state?s
obligation to move people off its waiting lists at a reasonable pace,
applying the Olmstead decision to people with disabilities who were not
institutionalized. The plaintiffs claimed that Hawaii was operating its
waiver program for people with mental retardation and developmental
disabilities in a manner that violated the ADA and Medicaid law. The
plaintiffs were living at home while on a waiting list for community- based
waiver services- the majority of the plaintiffs had been on the waiting list
for over 90 days and some for over 2 years. They could have obtained
services if they had been willing to live in institutions, but they wished
to stay in the community. The court found that Olmstead applied to the case
even though the plaintiffs were not institutionalized. Hawaii argued that
the plaintiffs were on the waiting list because of a lack of funds and that
providing services for more people would cause the state to exceed funding
limits set up in its waiver program. 36 The court rejected the state?s
34 Protection and Advocacy Organizations are part of a national protection
and advocacy system established by federal statutes to provide legal
representation and advocacy services for people with disabilities in every
state. These organizations operate through federal grants.
35 Makin v. Hawaii, 114 F. Supp. 2d 1017 (D. HI, 1999). 36 Hawaii had 976
federally approved ?slots? for its HCBS waiver program for people with
mental retardation in 1998. In 1999, 801 people were on the waiting list.
Page 22 GAO- 01- 1167T
argument and held that funding shortages did not meet the definition of a
?fundamental alteration.? The court also found that Hawaii did not provide
evidence of a comprehensive plan to keep the waiting list moving at a
reasonable pace, suggested by the Olmstead opinion. In July 2000, the
parties settled the case by agreeing that Hawaii would fund 700 additional
community placements over 3 years and move people from the waiting list at a
reasonable pace.
The Louisiana case 37 was filed in 2000 on behalf of people living in
nursing homes, or at imminent risk of nursing home admission, who were
waiting for services offered through three Medicaid HCBS waivers that
provided personal attendant care, adult day health care, and other services
to elderly and disabled adults. The plaintiffs claimed that the state was
failing to provide services in the most integrated setting as required by
the ADA. They also claimed that the state was not following Medicaid
statutory requirements to provide services with reasonable promptness and to
allow choice among available services. 38 As part of a settlement of this
case, Louisiana agreed to make all reasonable efforts to expand its capacity
to provide home and community- based services and to reduce waiting lists in
accordance with specific goals. For example, the state will increase the
number of waiver slots by a minimum of 650 slots by 2002, with additional
increases planned through 2005. The state also agreed to apply to CMS to add
a personal care service option to its Medicaid plan, thereby making personal
care services available to all eligible Medicaid recipients who are in
nursing homes, at imminent risk of nursing home admission, or recently
discharged. In addition, the state agreed to determine the status of persons
currently on waiting lists for waiver services and to take steps to inform
Medicaid beneficiaries and health professionals about the full range of
available service options.
Olmstead issues are also being addressed through a formal complaint
resolution process operated by the Office for Civil Rights (OCR) within HHS.
As part of its responsibility for enforcing the ADA, OCR receives and helps
resolve formal complaints related to the ADA. When OCR receives
37 Barthelemy v. Louisiana Department of Health and Human Services, Civil
Action No. 001083 (E. D. LA). 38 The Medicaid statute requires that states
furnish assistance ?with reasonable promptness to all eligible individuals.?
42 U. S. C. sect.1396a( 8). States with home and community- based care waiver
programs must provide assurances to HHS that individuals who are determined
to be likely to require institutional care be informed of the feasible
alternatives and provision of services ?at the choice of such individuals.?
42 U. S. C. sect. 1392n( c)( 2)( C). See also 42 U. S. C. sect.1396n( d)( 2)( C).
Page 23 GAO- 01- 1167T
Olmstead- related complaints from individuals and parties, it works through
its regional offices to resolve them by involving the complainants and the
affected state agencies. If a complaint cannot be resolved at the state and
regional OCR level, OCR?s central office may get involved. Finally, if these
steps are not successful, the complaint is referred to the Department of
Justice. As of August 2001, no Olmstead- related cases had been referred to
the Department of Justice.
From 1999 through August 2001, OCR received 423 ADA- related complaints. 39
These complaints generally involved a concern that people did not receive
services in the most integrated setting. OCR reported that, as of August
2001, 154 complaints had been settled and 269 remained pending. These
complaints had been filed in 36 states and the District of Columbia, with
more than half filed in seven states. A recent analysis of 334 Olmstead-
related complaints indicated that 228 complaints (68 percent) were related
to people residing in institutions. 40
The ongoing resolution of Olmstead- related lawsuits and complaints will
help establish precedent for the types of Medicaid program modifications
states may have to make to their long- term care programs. Meanwhile, it is
difficult to generalize about the potential impact of the many ongoing cases
because each case will be decided on its own facts. The extent of what
federal courts will require states to do to comply with the ADA as
interpreted in Olmstead will become more clear over time as additional cases
are resolved.
In the wake of the Olmstead decision, states may face growing pressures to
expand services for the elderly and other people with disabilities in a
variety of settings that allow for a range of choices. Despite the numerous
activities under way at the state and federal levels to respond to this
decision, the full implications of the Olmstead decision are far from
settled. Ongoing complaints and legal challenges continue to prompt states
to make incremental changes at the same time that they continue to frame
states? legal obligations for providing services to the disabled. States
face
39 OCR officials indicated that they were in the process of updating their
database with respect to Olmstead- related complaints and that the data
should be considered preliminary. 40 Presentation of Sara Rosenbaum, J. D.,
and Alexandra Stewart, J. D., School of Public Health and Health Services,
The George Washington University, at the National Academy for State Health
Policy Annual Conference, August 12, 2001, Charlotte, N. C. Concluding
Observations
Page 24 GAO- 01- 1167T
challenges in determining who and how many people meet the criteria of
needing and seeking services and also in balancing the resource and service
needs of eligible individuals with the availability of state funds.
This balancing of needs and resources will be an even greater issue in the
coming years as the baby boom generation ages and adds to the demand for
long- term care services. While Medicaid has a prominent role in supporting
the long- term care services provided today, other financing sources also
play an important role in our current system. These include private
resources- including out- of- pocket spending, private insurance, and family
support- as well as many other public programs. Finding ways to develop and
finance additional service capacity that meets needs, allows choice, and
ensures quality care will be a challenge for this generation, their
families, and federal, state, and local governments.
Mr. Chairman, this concludes my prepared statement. I will be happy to
answer any questions you or the other Committee members may have.
For more information regarding this testimony, please contact me at (202)
512- 7114 or Katherine Iritani at (206) 287- 4820. Bruce D. Greenstein, Behn
Miller, Suzanne C. Rubins, Ellen M. Smith, and Stan Stenersen also made key
contributions to this statement. Contacts and Staff
Acknowledgments
Page 25 GAO- 01- 1167T
Number of persons served, by waiver type State Number of
waivers Mentally retarded/
developmentally disabled Aged/ disabled Physically
disabled Other a Total
persons served
State expenditures
(in millions)
AK 4 589 712 345 0 1, 646 $38.3 AL 3 3, 994 5,826 335 0 10,155 129.1 AR 3 1,
104 8,158 298 0 9, 560 46.8 CA 5 34,212 8, 551 120 4,015 46,898 482.9 CO 10
6,517 11,481 0 1,929 19,927 209.6 CT 4 4, 328 8,978 198 0 13,504 364.0 DC 1
29 0 0 0 29 51.5 DE 3 490 734 0 365 1,589 34.4 FL 8 13,316 16,805 0 6,337
36,458 287.1 GA 4 2, 683 14,018 0 293 16,994 119.2 HI 4 948 923 0 66 1, 937
34.2 IA 5 4, 984 3,994 0 70 9, 048 86.6 ID 3 549 1,000 0 0 1,549 17.5 IL 5
6, 961 17,396 12,387 1, 483 38,227 290.8 IN 4 1, 866 2,338 0 131 4,335 84.5
KS 6 5, 325 6,701 3,822 894 16,742 239.9 KY 3 1, 060 13,339 52 0 14,451 97.3
LA 4 2, 885 759 113 0 3, 757 78.0 MA 2 11,076 5, 132 0 0 16,208 427.7 MD 3
10,021 132 0 205 10,358 156.7 ME 4 1, 624 1,395 697 0 3, 716 119.5 MI 3 8,
748 6,328 0 0 15,076 253.2 MN 5 7, 413 7,838 3,625 367 19,243 429.5 MO 5 7,
779 20,821 11 80 28,691 232.0 MS 3 348 2,540 127 0 3, 015 14.9 MT 2 980
1,514 0 0 2,494 41.7 NC 4 5, 016 11,159 0 273 16,448 316.3 ND 3 1, 845 347 0
14 2, 206 41.1 NE 4 2, 394 2,357 0 21 4, 772 88.3 NH 3 2, 535 1,367 0 90 3,
992 117.4 NJ 9 7, 027 4,587 290 611 12,515 292.3 NM 4 1, 752 1,404 0 212
3,368 119.2 NV 4 867 1,235 131 0 2, 233 15.1 NY 7 36,179 19,732 0 964 56,875
1, 784.9 OH 4 5, 897 26,135 0 0 32,032 316.8 OK 3 2, 687 9,042 0 0 11,729
172.9 OR 2 3, 583 26,410 0 0 29,993 298.9 PA 8 10,553 2, 463 1,948 70 15,034
516.2 RI 4 2, 833 2,304 58 0 5, 195 109.7 SC 5 4, 242 14,361 32 1, 390
20,025 151.7 SD 4 1, 764 791 52 0 2, 607 48.8 TN 3 4, 063 511 0 0 4,574
118.4
Appendix I: Medicaid Home and CommunityBased Services Waivers, by State,
1999
Page 26 GAO- 01- 1167T
Number of persons served, by waiver type State Number of
waivers Mentally retarded/
developmentally disabled Aged/ disabled Physically
disabled Other a Total
persons served
State expenditures
(in millions)
TX 6 6, 227 27,978 100 895 35,200 506.0 UT 5 0 3,422 21 97 3,540 66.0 VA 6
3, 650 11,835 235 523 16,243 211.2 VT 5 1, 553 1,014 0 208 2,775 67.7 WA 4
5, 071 25,718 0 35 30,824 332.2 WI 4 8, 884 13,900 0 205 22,989 387.9 WV 2 0
5,284 0 0 5,284 110.3 WY 3 1, 110 982 0 0 2,092 45.4
Total 212 259,561 381,751 24,997 21,843 688,152 $10,550.0
a ?Other? includes waivers that serve the conditions other populations, such
as children with special health care needs, persons with AIDS, individuals
with mental health needs, and individuals with traumatic brain injuries and
head injuries.
Source: Charlene Harrington and Martin Kitchener, Medicaid 1915( c) Home and
Community Based Waivers: Program Data, 1992- 1999, prepared for The Kaiser
Commission on Medicaid and the Uninsured (San Francisco, Calif.: University
of California, San Francisco, Aug. 2001).
Page 27 GAO- 01- 1167T
In January 2001, HCFA announced a set of grant initiatives called ?Systems
Change for Community Living.? These grants are intended to encourage states
to design and implement improvements in community long- term support
services. Total funding for these grants is $70 million for fiscal year
2001. States will have 36 months to expend the funds. States and other
organizations, in partnership with their disabled and elderly communities,
were invited to submit proposals for one or more of these four distinct
grant programs (see table 2). Agency officials reported receiving 161
separate applications for these grants for more than $240 million. The
agency expects all grant awards to be made by October 1, 2001.
Table 2: Overview of ?Systems Change for Community Living? Grants Name of
grant Description of grant
Total grant funding available Maximum
award Estimated
number of awards
Nursing Facility Transitions
To help states transition eligible individuals from nursing facilities to
the community.
$10 million to $14 million $1.2 million 16 to 26
Community Integrated Personal Assistance Services and Supports
To improve personal assistance services that are consumer- directed or offer
maximum individual control.
$5 million to $8 million $1.2 million 9 to 12
Real Choice Systems Change
To help design and implement effective and lasting improvements in community
support systems to enable children and adults of any age who have a
disability or longterm illness to live and participate in their communities.
$41 million to $43 million $3.5 million 30 to 40
National Technical Assistance Exchange for Community Living
To provide technical assistance, training, and information to states,
consumers, families, and other agencies and organizations.
$4 million to $5 million $4.0 million
to $5.0 million
1 Source: Coordinated Invitation to Apply for ?Systems Change Grants for
Community Living,? (Washington, D. C.: HHS, HCFA, May 17, 2001).
Appendix II: HCFA?s ?Systems Change for Community Living? Grant Initiative
Page 28 GAO- 01- 1167T
Long- Term Care: Baby Boom Generation Increases Challenge of Financing
Needed Services (GAO- 01- 563T, Mar. 27, 2001).
Mental Health: Community- Based Care Increases for People With Serious
Mental Illness (GAO- 01- 224, Dec. 19, 2000).
Long- Term Care Insurance: Better Information Critical to Prospective
Purchasers (GAO/ T- HEHS- 00- 196, Sept. 13, 2000).
Children With Disabilities: Medicaid Can Offer Important Benefits and
Services (GAO/ T- HEHS- 00- 152, July 12, 2000).
Adults With Severe Disabilities: Federal and State Approaches for Personal
Care and Other Services (GAO/ HEHS- 99- 101, May 14, 1999).
Assisted Living: Quality- of- Care and Consumer Protection Issues in Four
States (GAO/ HEHS- 99- 27, Apr. 26, 1999).
Nursing Homes: Complaint Investigation Processes Often Inadequate to Protect
Residents (GAO/ HEHS- 99- 80, Mar. 22, 1999).
Long- Term Care: Baby Boom Generation Presents Financing Challenges (GAO/ T-
HEHS- 98- 107, Mar. 9, 1998).
Medicaid: Waiver Program for Developmentally Disabled Is Promising but Poses
Some Risks (GAO/ HEHS- 96- 120, July 22, 1996).
Long- Term Care: Current Issues and Future Directions (GAO/ HEHS- 95109,
Apr. 13, 1995).
Medicaid Long- Term Care: Successful State Efforts to Expand Home Services
While Limiting Costs (Aug. 11, 1994).
Health Care Reform: Supplemental and Long- Term Care Insurance (GAO/ T- HRD-
94- 58, Nov. 9, 1993).
(290083) Related GAO Products
*** End of document. ***