Adults With Severe Disabilities: Federal and State Approaches for
Personal Care and Other Services (Letter Report, 05/14/1999,
GAO/HEHS-99-101).

According to a national survey done in 1994 and 1995, 2.3 million adults
living in home- or community-based settings require considerable
assistance with basic daily activities, such as bathing and dressing, to
avoid institutionalization. Affording such help was a problem, however.
Disabled adults were more likely than the general population to live in
a family with an income of less than $20,000 and were almost twice as
likely to live below the U.S. poverty threshold. Eighty-four percent of
those aged 18 to 64 were jobless. More than 80 percent of severely
disabled adults had public health insurance, primarily Medicare or
Medicaid or both. At least 70 different federal programs assist
individuals with disabilities. An estimated $79 billion in benefits will
be paid in fiscal year 1999, primarily through Social Security
Disability Insurance and Supplemental Security Income. Other programs
provide a mixture of cash and services. Medicaid's fastest-growing
outlays are for home- and community-based services waivers. The states
are increasingly taking advantage of the flexibility these waivers allow
to design and target programs that meet unique state needs. Personal
care programs in California, Kansas, Maine, and Oregon reflect diverse
approaches and can serve as models for other states to expand service
delivery in noninstitutional settings and emphasize consumer
participation in directing services to meet their own care needs.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-99-101
     TITLE:  Adults With Severe Disabilities: Federal and State
	     Approaches for Personal Care and Other Services
      DATE:  05/14/1999
   SUBJECT:  Health care programs
	     Home health care services
	     Disability benefits
	     Persons with disabilities
	     State-administered programs
	     Disadvantaged persons
	     Waivers
	     Health surveys
	     Aid for the disabled
	     Long-term care
IDENTIFIER:  Oregon
	     Maine
	     California
	     Kansas
	     Social Security Disability Insurance Program
	     Supplemental Security Income Program
	     Medicare Program
	     Medicaid Program
	     National Health Interview Survey
	     VA Aid and Attendance Benefit Program

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO report.  This text was extracted from a PDF file.        **
** Delineations within the text indicating chapter titles,      **
** headings, and bullets have not been preserved, and in some   **
** cases heading text has been incorrectly merged into          **
** body text in the adjacent column.  Graphic images have       **
** not been reproduced, but figure captions are included.       **
** Tables are included, but column deliniations have not been   **
** preserved.                                                   **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
** A printed copy of this report may be obtained from the GAO   **
** Document Distribution Center.  For further details, please   **
** send an e-mail message to:                                   **
**                                                              **
**                                            **
**                                                              **
** with the message 'info' in the body.                         **
******************************************************************

    United States General Accounting Office GAO                Report
    to Congressional Requesters May 1999           ADULTS WITH SEVERE
    DISABILITIES Federal and State Approaches for Personal Care and
    Other Services GAO/HEHS-99-101 GAO    United States General
    Accounting Office Washington, D.C. 20548 Health, Education, and
    Human Services Division B-280728 May 14, 1999 The Honorable Pete
    V. Domenici Chairman Committee on the Budget United States Senate
    The Honorable John R. Kasich Chairman Committee on the Budget
    House of Representatives Millions of adults of all ages have
    severe disabilities; are unable to perform basic daily activities
    such as bathing and dressing; and often require substantial
    financial, medical, or other supportive services. Financing for
    these and other long-term care services comes from both public and
    private sources. For example, the federal government provides cash
    assistance, health insurance, and other supportive services, many
    of which are targeted at individuals with disabilities.
    Historically, public funding for such individuals has consisted
    primarily of cash benefits or services delivered in nursing homes
    or similar institutions. However, the provision of long-term care
    has changed, as an increasing number of adults with disabilities
    receive services in the community. Medicaid, a joint federal/state
    program that provides medical care for certain categories of low-
    income Americans, has played a significant role in the movement
    toward community-based personal care and support services.
    Medicaid gives states flexibility in how they provide personal
    care services-for example, through such innovations as allowing
    individuals with disabilities to select and direct their own
    caregivers. States most frequently approach community-based
    services under Medicaid using one of two optional benefits, both
    of which give states flexibility in deciding which beneficiaries
    will be served and allow a wide range of services to be covered.
    Recently, some advocacy groups and consumers with disabilities
    have challenged the optional nature of community-based long-term
    care with its flexibility to limit both the number and categories
    of individuals served. The cost and policy implications of
    changing the current provision of community-based care are
    considerable and require a broad understanding of the current
    framework under which adults with disabilities receive services.
    With the goal of obtaining basic information Page 1
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 to enhance
    understanding of these issues, you asked us to (1) estimate the
    number and characteristics of adults with severe disabilities; (2)
    quantify the federal assistance available to such individuals; (3)
    describe Medicaid coverage of personal care and related services;
    and (4) discuss how a sample of selected states have implemented
    Medicaid policies that allow consumers to select their own
    caregivers, an approach called consumer direction. We used the
    National Health Interview Survey (NHIS) to derive estimates of the
    number of individuals with severe disabilities who live in the
    community, rather than in institutions. We also conducted
    interviews with research and advocacy groups on disability,
    identified public programs that addressed the needs of adults with
    severe disabilities, and visited a sample of states identified as
    innovators in the provision of personal care: California, Kansas,
    Maine, and Oregon. We conducted our review from June 1998 through
    April 1999, in accordance with generally accepted government
    auditing standards. Appendix I contains a more detailed discussion
    of our scope and methodology. Results in Brief    Our analysis of
    1994-95 NHIS data showed 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
    activities of self-care. For such individuals with severe
    disabilities, obtaining personal care on what is often a daily
    basis is critical to avoiding institutionalization. However,
    without help from family, friends, or public programs, affording
    such assistance may be problematic, because individuals with
    severe disabilities were usually less well off economically than
    the general population. Adults with disabilities were more likely
    than the general population to live in a family with an income of
    less than $20,000 and were almost twice as likely to live below
    the U.S. poverty threshold. Eighty-four percent of adults aged 18
    to 64 with severe disabilities were either out of work or did not
    participate in the workforce. In addition, adults of all ages with
    severe disabilities were more likely to have less than a high
    school education. Over 80 percent of the adults with severe
    disabilities in our sample reported having public health
    insurance, primarily Medicare, Medicaid, or both. At least 70
    different federal programs provide assistance to individuals with
    disabilities. Having a disability is a central eligibility
    criterion for 30 programs that have estimated fiscal year 1999
    expenditures totaling $110 billion. The majority of these funds
    ($79 billion) are used to pay cash benefits, primarily through the
    Social Security Disability Insurance and Supplemental Security
    Income programs. Other programs provide a Page 2
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 mixture of cash
    and services to veterans with disabilities ($28 billion) or offer
    other individuals educational, training, employment, social, and
    other services ($3 billion). For a second, larger group of 40
    programs, disability is one of many potential eligibility
    criteria. Within these 40 programs, Medicare and Medicaid are the
    most significant sources of federal funds that cover nonskilled
    personal care services for individuals with disabilities.
    Medicare's home health benefit, which cost over $17.7 billion in
    1997, has become a significant source of personal care funding and
    over time has changed in focus from solely a short-term, acute
    care benefit to a longer-term, chronic care benefit. Most Medicaid
    personal care and related services are optional benefits that are
    provided at the discretion of each state. The fastest growing
    expenditures are for Medicaid home- and community-based services
    (HCBS) waivers, which grew at an average annual rate of 31 percent
    between 1987 and 1998-twice as much as Medicaid home health (a
    required benefit) and three times as much as the personal care
    services (PCS) optional benefit. States apply to the federal
    government for HCBS 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. Nearly all states have HCBS
    waivers, and 40 states use them as the primary funding source for
    Medicaid community-based care. However, recent court challenges to
    the service and expenditure limits imposed by HCBS waivers have
    raised questions regarding whether states will be allowed to
    continue these practices. These pending cases have raised concerns
    in a few states that waiver costs will increase; if so, there may
    be additional costs for the federal government as well. The
    consumer direction policies of the Medicaid programs in
    California, Kansas, Maine, and Oregon reflected the advantages and
    complexities of self-direction as well as the competing concerns
    among states, caregivers, and consumers. While most states offered
    consumers choice regarding the selection and hiring of a
    caregiver, consumer direction varied most often in the extent to
    which consumers had authority to train their own caregivers and
    manage the payroll. Despite differences in models of consumer
    direction, all four states confronted similar issues regarding the
    quality and availability of consumer-directed services. In
    general, states and consumers identified two challenges: (1)
    ensuring a qualified pool of personal caregivers for what are
    usually low-wage positions that typically attract individuals with
    little or no training and (2) balancing states' Page 3
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 concerns
    regarding consumer safety with consumers' right to direct their
    own care. Background    The term "disability" can be broadly
    applied to mean limitations that are physical, mental, or both and
    that hinder performance of everyday activities. Within this broad
    characterization, there are considerable differences in severity
    and in the need for assistance.1 For some individuals with
    disabilities, assistance from another person is necessary-either
    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 can
    enable continued independent functioning. Disability can be
    present from an early age, such as in the case of individuals with
    mental retardation/developmental disabilities; occur as the result
    of a disease or traumatic injury; or manifest itself as a part of
    the natural aging process. Moreover, different forms of disability
    can pose different challenges. 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 more than hands-on assistance.
    Personal care, a key component of community-based long-term care
    services, is one term used to describe "hands-on" or one-on-one
    assistance provided to individuals needing help with basic
    activities of daily life in a noninstitutional setting.2 Personal
    care is nonmedical and involves aiding individuals with
    limitations in the ability to perform activities of daily living
    (ADL) and instrumental activities of daily living (IADL). ADLs
    include bathing, dressing, eating, transferring from a bed to a
    chair, using the toilet, and moving around the house, while IADLs
    cover preparing meals, shopping, managing money, using the
    telephone, and performing heavy or light housework. The number of
    self-care tasks for which an individual requires assistance is a
    good indicator of severity of need, and the amount and intensity
    of long-term care assistance a person needs increase appreciably
    with the number of his or her impairments. The increase in need
    for assistance is especially dramatic for individuals with
    limitations in three or more ADLs. While there are other
    definitions of 1In fact, estimates of the number of individuals
    with disabilities ranged from 1 million to well over 10 million,
    depending upon the definitions used. 2Some people with
    disabilities prefer to use the terms "supports" or "services"
    rather than "care" and think of themselves as "consumers" rather
    than "clients" or "care recipients." We use the term "personal
    care" because of its use by and common association with the
    Medicaid program. However, it is intended as a broad descriptive
    term for hands-on assistance to or supervision of an individual.
    Page 4                                                  GAO/HEHS-
    99-101 Severely Disabled Adults B-280728 disability, ADL and IADL
    limitations can be directly linked to the need for personal care.3
    Medicaid and, to some extent, Medicare are the two primary sources
    of public funding for personal care. Medicaid, a joint
    federal/state health financing program for low-income Americans
    who are aged, blind, or disabled, is the principal source of
    public funding for long-term care, with 1998 expenditures of $59.1
    billion. In 1996, Medicaid accounted for 38 percent of total long-
    term care spending. Historically, Medicaid long-term care
    expenditures financed services delivered in nursing homes or other
    institutions, whereas home- or community-based care was
    predominantly provided informally by family, friends, or both, or
    paid for with private funds. While most community-based care
    continues to be provided on an informal basis, Medicaid has
    increased its funding of community-based services. Between 1987
    and 1998, community-based long-term care expenditures increased
    from 10 percent to 25 percent of Medicaid long-term care spending.
    Medicaid offers three benefits that provide personal care: the
    home health benefit; the PCS benefit; and HCBS waivers, which
    operate under section 1915(c) of the Social Security Act. Within
    broad federal guidelines, states determine the amount and duration
    of services offered under their Medicaid programs. States may, for
    example, place reasonable limits on services or require
    authorization to be obtained prior to service delivery. Home
    Health Benefit    States must offer home health services as a part
    of their Medicaid program to all beneficiaries who are entitled to
    nursing facility services. Under Medicaid, a physician must order
    home health services as part of a care plan that is reviewed
    periodically and includes part-time or intermittent nursing
    services; home health aide services; and medical supplies,
    equipment, and appliances suitable for use in the home. Home
    health aide services must be provided by a home health agency and
    can include personal care. PCS Benefit            States may, at
    their option, choose to offer the PCS benefit as part of their
    Medicaid program. Medicaid defines the PCS benefit as services
    that are (1) authorized for an individual by a physician in
    accordance with a plan of 3Examples of other definitions of
    disability include (1) measures of physical activities such as
    walking, lifting, reaching; (2) serious sensory impairments; (3)
    serious symptoms of mental illness; and (4) inability to work.
    Page 5                                                 GAO/HEHS-
    99-101 Severely Disabled Adults B-280728 treatment;4 (2) provided
    by an individual who is qualified to provide such services and who
    is not a member of the individual's family;5 and (3) furnished in
    a home or, if the state chooses, in another location.6 States may
    limit the PCS benefit through two mechanisms: medical necessity
    and utilization control. HCBS Waivers    HCBS waivers provide
    states greater flexibility in program design, permitting the
    adoption of a variety of strategies to control the cost and use of
    services. Thus, states may "waive" certain provisions of the
    Medicaid statute, such as (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 target
    services to 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).7 To receive an HCBS waiver, states
    must demonstrate that the cost of the services to be provided
    under a waiver (plus other state Medicaid services) is no more
    than the cost of institutional care (plus any other Medicaid
    services provided to institutionalized individuals). Waivers
    permit states to cover a wide variety of nonmedical and social
    services and supports that allow people to remain in the
    community, including personal care, personal call devices,
    homemakers' assistance, chore assistance, adult day health care,
    and other services that are demonstrated as cost-effective and
    necessary to avoid institutionalization. Medicare, a federal
    program that provides health insurance to Americans 65 and older
    as well as to certain disabled individuals, offers a home health
    benefit that can include in-home services provided by an aide. To
    be eligible for Medicare home health, a beneficiary must be
    confined to the home, be under the care of a physician who
    establishes a plan of care, and 4Under Medicaid, states may also
    approve "service plans," which are similar to physician-prescribed
    treatment plans. 5"Family member" is defined as a legally
    responsible relative (42 C.F.R. sec. 440.167(b)). This includes
    spouses of recipients and parents of minor recipients, including
    any stepparents who are legally responsible for minor children.
    Adult children are not included in this definition. 6The PCS
    benefit is not available to Medicaid-eligible individuals who are
    hospitalized or reside in a nursing facility, an intermediate care
    facility for people with mental retardation, or an institution for
    mental disease. 7For example, under institutional eligibility
    rules, the parents' income is not counted when determining their
    child's eligibility for Medicaid. The parents' income is counted
    under the community rules. Page 6
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 have a need for
    at least one of the following: intermittent skilled nursing care,
    physical therapy, speech therapy, or continuing occupational
    therapy. Finally, the beneficiary must receive services under a
    plan of care that is reviewed periodically. A physician can
    prescribe a home health aide only if all the coverage conditions
    are met. Any home health aide services must consist primarily of
    personal care activities; chores, housekeeping, and other services
    must be incidental to the personal care services performed and not
    add to the time of the visit. Under the PCS benefit and HCBS
    waivers, some states have allowed consumers of personal care to
    direct their own services, a concept known as consumer direction.
    Consumer direction includes a range of potential activities. At a
    minimum, consumer direction entails some degree of decision-making
    on the part of consumers regarding their service needs, who should
    provide their care, and their evaluation of the quality and
    appropriateness of the services received. Consumer direction
    differs from the traditional, agency-based system of personal care
    in which people with disabilities have little control over the
    choice of caregivers, staff schedules, and policies regarding what
    services will be provided. At its best, consumer direction can
    tailor services to meet the expressed needs and personal
    preferences of consumers; thus, it involves helping define the
    services to be delivered and making important decisions about
    caregiving. While Medicaid enabling legislation does not authorize
    cash payments to beneficiaries, states can allow consumers to
    direct their own care through hiring, training, and supervising
    their personal care attendants. States with consumer direction may
    also establish processes that permit consumers to assist in
    payroll management, tax filings, and other fiscal
    responsibilities. Over Two Million                   We estimate
    that approximately 2.3 million adults living in the community
    Adults With Severe                 have severe disabilities and
    require considerable help from another person to perform multiple
    ADLs or IADLs. There are a variety of methods and Disabilities
    Live in the definitions for identifying individuals with severe
    disabilities. Our estimate Community                          is
    based on NHIS data and includes adults with both physical and
    cognitive impairments who required personal care in a home- or
    community-based long-term care setting.8 Adults with severe
    disabilities were less likely to work, had less education, and had
    less income than the general population. Adults aged 18 to 64 with
    severe disabilities were also much more likely to have public
    health insurance coverage, primarily through 8We selected NHIS in
    part because it allowed individuals to provide an indication of
    the amount of assistance they required. Page 7
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Medicare and
    Medicaid, than those of similar age in the general population. No
    Consensus Definition          There is no consensus on what
    constitutes a severe disability. Individuals of Severe Disability
    Exists      differ in the number of functional areas in which they
    require assistance (expressed by ADLs or ADLs in combination with
    IADLs) and the level of difficulty they have in performing the
    activity. Using NHIS, we estimated that the number of individuals
    with severe disabilities ranged from 1.4 to 3.3 million, depending
    upon the definition of severity used (see fig. 1). For purposes of
    demographic analysis, we selected a definition of adults that
    focused primarily on individuals' ability to perform ADLs but also
    included an IADL component. Specifically, we defined an adult with
    severe disabilities as an adult who has either a lot of difficulty
    with or is unable to perform either * three or more ADLs or * two
    ADLs and four IADLs.9 9Our definition focuses on adults living in
    the community; thus, individuals with severe disabilities residing
    in nursing homes or other institutions are excluded from this
    analysis. Page 8
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 1:
    Estimates of Number of Adults With Severe Disabilities, 1994-95
    Four or More ADLs, High Difficulty
    1.4 Four or More ADLs, Any Difficulty
    1.6 Three or More ADLs, High Difficulty
    1.9 Three or More ADLs, Any Difficulty 2.3 Two ADLs and Four+
    IADLS OR Three or More ADLs, High Difficulty
    2.3              Estimate Used for This Report Two ADLs and Four+
    IADLS OR Three or More ADLs, Any Difficulty
    2.6 Two or More ADLs, High Difficulty
    2.9 Two or More ADLs, Any Difficulty
    3.3 0               0.5              1          1.5             2
    2.5              3                 3.5 Millions 18 to 64 65 and
    Over Note: We identified two levels of difficulty in performing
    ADLs and IADLs: (1) "any difficulty," which means an adult
    reported some difficulty, a lot of difficulty, or being unable to
    perform a requisite number of activities, and (2) "high
    difficulty," which means an adult reported a lot of difficulty or
    being unable to perform activities. Source: NHIS 1994-95 data.
    Adults With Severe                                  Adults with
    severe disabilities were considerably less well off than the rest
    Disabilities Had Lower                              of the general
    population in several key areas, as summarized in figure 2.
    Employment, Education,                              Working age
    adults (18 to 64) with severe disabilities were far less likely to
    and Income                                          work, with 84
    percent reporting that they were either out of work or did not
    participate in the workforce. Additionally, adults 18 and over
    with Page 9
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 severe
    disabilities were more likely to have less than a high school
    education, live in a family with an income of less than $20,000
    per year, and live with a relative that is not a spouse.
    Furthermore, adults 18 and over with severe disabilities were
    almost twice as likely to live below the U.S. poverty threshold
    than nondisabled individuals. Figure 2: Selected Characteristics
    of Adults With Severe Disabilities Compared With Those of the
    General Population, 1994-95 Unemployed/Not in Labor Force (Aged 18
    to 64)
    84 23 Less Than High School Education
    43 19 Family Income Less Than $20,000
    42 23 Live With Relative That Is Not a Spouse
    33 23 Below U.S. Poverty Threshold                              18
    10 0  10  20 30 40 50 60 70 80 90 Percentage Adults With Severe
    Disabilities General Adult Population Source: NHIS 1994-95 data.
    Page 10                                       GAO/HEHS-99-101
    Severely Disabled Adults B-280728 Most Adults With Severe
    Most adults with severe disabilities reported receiving public
    health Disabilities Qualified for    insurance coverage, primarily
    Medicare and Medicaid. Of our estimated Public Health Insurance
    2.3 million adults with severe disabilities, 1.9 million, or 84
    percent, Coverage                      reported having some form
    of public health insurance, as shown in figure 3. Because almost
    everyone aged 65 or older is eligible for Medicare, age was a
    significant factor in health insurance coverage. While younger
    adults with severe disabilities were less likely to have public
    health coverage than those 65 and over, they were far more likely
    to have public coverage than those of a similar age in the general
    population. Because disability is one eligibility criterion for
    both programs, an adult aged 18 to 64 with severe disabilities was
    7 times as likely to receive Medicaid coverage and over 18 times
    as likely to receive Medicare10 than the nondisabled general
    population. 10In 1998, 5.2 million individuals below the age of 65
    with disabilities qualified for Medicare, accounting for
    approximately 13 percent of program beneficiaries. Page 11
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 3: Adults
    With Severe Disabilities Covered by Public Health Insurance, 1994-
    95 66 All Types of Public Health Insurance
    96 84 37 Medicare
    92 69 35 Medicaid                                    20 26 0
    10    20         30              40       50           60
    70           80             90          100 Percentage 18 to 64 65
    and Over Total Notes: Public health insurance includes Medicare,
    Medicaid, military, veterans', and Indian Health Services
    coverage. Approximately 2 percent reported military health
    coverage. Medicare and Medicaid coverage categories are not
    mutually exclusive; a person can qualify for both programs at the
    same time. Source: NHIS 1994-95 data. Page 12
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Many Federal
    We identified two groups of federal programs that provide
    assistance to11 Programs Provide               individuals with
    disabilities-a term that is applied in a variety of ways. The
    first group uses various definitions of disability as a central
    criterion Assistance to Adults           for eligibility and
    consists of 30 programs with estimated expenditures With
    Disabilities              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 Medicare and Medicaid, for which age, income, or both
    also serve as bases for eligibility.12 Medicaid is the most
    significant source of federal funds for providing personal care
    services to individuals with disabilities. The provision of
    personal care services under Medicare is limited to its home
    health benefit, the use of which has been growing over the past
    decade. $110 Billion in Federal        For fiscal year 1999, the
    federal government will obligate an estimated Programs Is Targeted
    $110 billion across 30 programs and services that specifically
    offer benefits Exclusively for Individuals    to individuals with
    disabilities.13 The three largest programs-Social With
    Disabilities              Security Disability Insurance,Veterans
    Compensation for Service- Connected Disabilities, and Supplemental
    Security Income-offer cash benefits to eligible individuals and
    account for over 86 percent of this total. One program within the
    30, the Department of Veterans Affairs (VA) Aid and Attendance
    program, explicitly offers personal care services through a cash
    allowance and provides an additional cash allowance to eligible
    veterans if their disabilities make it impossible to perform basic
    ADLs without the assistance of another person.14 Figure 4 shows
    the distribution of the $110 billion by budget function. 11The
    eligibility criteria for federal programs are not consistent with
    the definition we used to estimate the number of adults with
    severe disabilities. For federal programs, disability can be
    linked to an individual's ability to work, rather than the need
    for assistance with ADLs and IADLs. While these two definitions
    are not mutually exclusive, they are not necessarily the same. In
    fact, many of these federal programs are likely to serve very
    different populations than those represented in our estimate of
    2.3 million. For example, one program offers independent living
    services to individuals with visual impairments, and another
    offers employment training to individuals with physical or mental
    impairments that impede employment. 12We have not included
    expenditures for these 40 programs because the broader eligibility
    criteria did not allow us to determine the amount of expenditures
    that could be attributed to individuals with disabilities. 13This
    estimate includes 77 percent of the expenditures of the
    Supplemental Security Income program, which is the percentage of
    individuals with disabilities served by this program. Supplemental
    Security Income is an income- and resource-tested cash assistance
    program for low-income individuals who are aged, blind, or
    disabled. 14For more information on consumer-directed personal
    care offered under this program, see Consumer-Directed Personal
    Care Programs: Department of Veterans Affairs and Medicaid
    Experience (GAO/HEHS-98-50R, Jan. 16, 1998). Page 13
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 4:
    Distribution of the Estimated $110 Billion Designated Specifically
    for     Billions
    Education, Training, Employment, Individuals With Disabilities, by
    $3                                and Social Services Budget
    Function, Fiscal Year 1999 $22                       Income
    Security (Includes Supplemental Security Income and Housing
    Assistance) $57                   $28
    Veterans' Benefits and Services Social Security Disability
    Insurance Source: General Services Administration, Catalogue of
    Federal Domestic Assistance (Washington, D.C.: GSA, Dec. 1998).
    Appendix II summarizes the 30 programs for which disability is a
    condition of participation, and appendix III lists the broader
    array of 40 programs that include disability as one of many
    potential eligibility criteria. Medicare Home Health Has
    Although Medicaid is the most significant source of federal funds
    for Become a Significant                        providing personal
    care services to people with disabilities, the Medicare Source of
    Funds for                         home health benefit-particularly
    the long-term use of a home health Community-Based Care
    aide-has become an important source of nonskilled personal care
    for individuals with disabilities and the elderly. This benefit,
    originally established for beneficiaries recovering from illness
    or injury after a hospitalization, has been used by an increasing
    number of beneficiaries as a source of custodial care for chronic
    conditions.15 This shift toward more long-term care services has
    been a major contributor to the 20-percent average annual growth
    in Medicare home health costs between 1981 and 15See Medicare Home
    Health: Success of Balanced Budget Act Cost Controls Depends on
    Effective and Timely Implementation (GAO/T-HEHS-98-41, Oct. 29,
    1997). Page 14
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 1997. Figure 5
    shows the dramatic increases in Medicare home health
    expenditures.16 Figure 5: Medicare Home Health Expenditures, 1981-
    97             20 Billions of Dollars 18 16 14 12 10 8 6 4 2 0
    1981    1982    1983    1984    1985    1986    1987    1988
    1989    1990    1991    1992    1993    1994    1995    1996
    1997 Source: Health Care Financing Administration (HCFA), Office
    of the Actuary. Longer-term use of the home health benefit,
    particularly for home health aide services, has increased Medicare
    spending. In 1989, the proportion of home health users receiving
    more than 30 visits was 24 percent. In 1996, this proportion had
    increased to 49 percent, indicating that the program was serving a
    larger proportion of longer-term patients. Moreover, 55 percent of
    beneficiaries receiving home health care in 1997 had not been
    recently hospitalized, another indication that those receiving
    care were not in need of short-term acute care (such as following
    a hospital stay), but of longer-term care for chronic conditions,
    which are often associated with disability. For 1996, over 48
    percent of all Medicare visits 16From 1995 through 1997, the rate
    of growth of the Medicare home health benefit slowed, and Medicare
    home health expenditures declined in 1998. The amount of the
    decline is uncertain, however, since these expenditures have not
    been finalized. Page 15
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 were made by
    home health aides and, as shown in table 1, 5 percent of home
    health aide users received about 41 percent of those visits. Table
    1: Beneficiaries' Use of Medicare Home Health Aides, 1996
    Percentage of home Number of visits per user          Percentage
    of total users            health aide visits 1-9
    22.2                      0.2 10-29
    28.9                      2.1 30-49
    13.0                      3.4 50-99
    14.6                      9.6 100-149
    6.7                    10.7 150-199
    4.7                    12.9 200-249
    2.8                    10.3 250-299
    2.0                      9.9 300+
    5.0                    40.8 Total
    100.0                   100.0 Note: Percentages may not total 100
    because of rounding. Source: Medicare Payment Advisory Commission.
    Most Medicaid                              Under Medicaid, states
    have three approaches for providing personal care, Personal Care
    and                          two of which may be offered at the
    discretion of the state. First, states must offer the Medicaid
    home health services benefit (including home Related Services Are
    health aides), which may provide unskilled personal care services.
    Second, Optional Benefits                          states may
    choose to provide the PCS benefit, which offers unskilled personal
    care services as a part of the states' Medicaid benefit package.
    Offered by States                          Third, HCBS waivers,
    which were first introduced in 1981, give states the option of
    providing personal care and other related services if they choose
    to do so. HCBS services operate under markedly different rules
    than the home health and PCS benefits, which must be offered to
    all eligible individuals. In particular, HCBS waivers allow states
    to limit geographic availability, target specific populations or
    conditions, limit the number of individuals served, and cap waiver
    expenditures. The popularity of HCBS waivers is evidenced by their
    growth rate: from 1987 to 1998, expenditures under HCBS waivers
    grew at an average annual rate of 31 percent, compared with 16
    percent for home health and 10 percent for the PCS benefit.
    Appendix IV summarizes the growth of each of the three Medicaid
    approaches to personal care and provides information on how states
    use them to provide community-based care. Page 16
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Finally, recent
    court challenges to service provision limits and to the selective
    nature of some personal care waiver programs have raised serious
    concerns about the continued viability of HCBS waivers. These
    pending cases have raised concerns among a few states that waiver
    costs will increase; if so, there may be additional costs for the
    federal government as well. Medicaid Home Health Has    In
    contrast to the very rapid growth in the Medicare home health
    benefit Grown Modestly              since the late 1980s,
    expenditures under Medicaid home health have Compared With
    Medicare      increased more modestly. A physician must order
    Medicaid home health in accordance with a plan of care that is
    reviewed periodically and details the use of services required. A
    prescribed care plan may or may not include the services of a home
    health aide, but the home health benefit must make available
    medical services (such as nursing services), supplies, equipment,
    and appliances suitable for use in the home. Between 1987 and
    1997, expenditures for Medicaid home health grew at an average
    annual rate of 17 percent, compared with 26 percent for Medicare
    home health. Figure 6 shows annual changes in expenditures for the
    two programs during this period. Page 17
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 6:
    Comparison of Growth in Medicare and Medicaid Home Health
    Expenditures, 1987-97 60 Percentage Change 50 40 30 20 10 0 1987-
    88          1988-89    1989-90    1990-91           1991-92
    1992-93        1993-94         1994-95      1995-96        1996-97
    Medicare Medicaid Source: HCFA. States are permitted to use
    medical necessity and utilization control methods to manage the
    use of Medicaid home health services. For example, California
    requires prior authorization for more than one visit in a 6-month
    period and will approve a maximum of 30 visits at a time. Florida
    limits visits to 60 per year, except by prior authorization.17
    Other states limit the hours of service provided each day; require
    preauthorization if the services are not in conjunction with a
    recent hospitalization; or impose limits on the type of services
    provided, such as nurse, therapy, or home health aide visits.
    17While Medicaid services for home health can range from those of
    a home health aide to more skilled services (for example,
    physical, occupational, or speech therapy or nursing services),
    expenditures are not tracked by the type of home health visit
    made. Page 18
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Medicaid PCS
    Benefit          Of the Medicaid approaches offering personal
    care, the PCS benefit is Requires Statewide Service    offered by
    the fewest states; accordingly, it has had the slowest average
    Provision but Allows          annual growth: 10 percent from 1987
    to 1998. About three-fifths of the Service Limits
    states and the District of Columbia had elected to use the PCS
    benefit under Medicaid as of 1998, as shown in figure 7. Once
    elected, the PCS benefit must be provided to all eligible
    individuals with a demonstrable need for personal care, a factor
    that may prevent additional states from adopting this benefit.
    Page 19                                 GAO/HEHS-99-101 Severely
    Disabled Adults B-280728 Figure 7: States Offering the PCS
    Benefit, 1998 PCS Benefit (28) No PCS Benefit (23) Note: Arizona
    operates a personal care program as part of a separate section
    1115 waiver; because HCFA includes these expenditures as part of
    its PCS benefit totals, Arizona is identified as a PCS state in
    this map. Source: Medicare and Medicaid Guide (Chicago, Ill.:
    Commerce Clearing House, Inc.). States offering the PCS benefit
    are afforded some flexibility in order to contain costs or target
    services to particular populations. For example, states are
    allowed to set their own criteria for establishing who needs the
    PCS benefit and may use a wide variety of assessment instruments
    or other Page 20
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 procedures to
    determine who receives services. Variations in the use of the PCS
    benefit are apparent across states, reflecting these
    implementation differences. For example, California relies on the
    PCS benefit primarily as a means of providing personal care
    services to individuals with long-term care needs, whereas Oregon
    targets this benefit toward an acute-care, more medically based
    service. Other states establish eligibility for the PCS benefit by
    identifying functional impairment. For example, Maine and New
    Hampshire limit eligibility to individuals with chronic or
    permanent disabilities, while Florida limits the PCS benefit to
    children. Table 2 shows PCS benefit expenditures and their
    proportion of each state's total Medicaid home and community
    expenditures for fiscal year 1998. Page 21
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Table 2: States'
    Use of the PCS Benefit, Ranked by Percentage of Total
    Percentage of Medicaid Community-Based
    community-based                FY 1998 PCS benefit Expenditures,
    Fiscal Year 1998            State
    expenditures                      expenditures California
    59.10                    $324,379,099 Arkansas
    49.36                       63,244,424 Idaho
    42.46                       15,238,552 New York
    41.90                   1,655,085,940 Michigan
    39.95                     207,957,621 Texas
    35.33                     228,816,135 New Jersey
    33.51                     169,711,230 Montana
    32.41                       13,365,579 Missouri
    28.84                       91,636,182 North Carolina
    28.20                     135,870,664 Washington
    27.79                     120,122,810 Massachusetts
    22.05                     139,105,479 Arizona
    19.98                          266,642 West Virginia
    18.56                       27,845,161 Minnesota
    18.49                       98,637,571 Wisconsin
    15.08                       65,534,473 Oklahoma
    15.03                       24,184,928 Alaska
    12.11                        4,246,146 Maryland
    10.39                       24,051,519 Nevada
    9.53                       2,025,840 Oregon
    6.77                      19,961,594 Nebraska
    5.58                       5,381,619 Floridaa
    3.82                      14,136,021 Kansas
    3.74                       8,213,577 Maine
    3.06                       3,596,006 District of Columbia
    2.73                         366,038 Vermonta
    2.15                       1,527,670 New Hampshire
    2.10                       2,294,653 South Dakota
    1.55                         732,931 South Carolinaa
    0.81                       1,177,397 Utah
    0.66                         431,427 aThese states do not offer
    the PCS benefit to adults but report expenditures because of
    services provided to children under the Early and Periodic
    Screening, Diagnostic, and Treatment program. Source: HCFA. Page
    22                                              GAO/HEHS-99-101
    Severely Disabled Adults B-280728 States also control utilization
    of the PCS benefit by requiring prior authorization, establishing
    limits on the duration of services, or both. For example, of the
    27 states and the District of Columbia, 7 require prior
    authorization for personal care services and 15 limit the hours or
    units of service provided.18 (App. V summarizes approaches states
    take to limit services under the PCS benefit through the use of
    assessment tools and limits on services.) States Make Use of
    The enactment of HCBS waivers gave states more flexibility in
    program Controls and Flexibility    design and more control over
    expenditures. HCBS waivers allow states to Afforded by HCBS
    Waivers    target services to specific populations, geographic
    areas, or both. HCBS waivers also allow states to set expenditure
    caps, limit services to a specific number of individuals, and-
    similar to the PCS benefit-impose limits on the number of hours of
    services provided. From 1987 to 1998, HCBS waivers grew at an
    average annual rate of 31 percent, increasing in popularity and
    use among states. In contrast to the PCS benefit, which 23 states
    did not offer, HCBS waiver expenditures were reported by almost
    every state in 1998, and all but 8 of these states had at least
    one waiver that offered personal care services (see fig. 8). Only
    two states used the PCS benefit for the majority of their Medicaid
    community-based expenditures, while 40 states channeled over half
    of their community-based Medicaid expenditures through HCBS
    waivers. (App. V summarizes HCBS waivers that offered personal
    care.) 18Of the 14 states and the District of Columbia with
    service limits, 7 do not allow these limits to be exceeded, while
    the remaining 8 allow exceptions with prior authorization. Page 23
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 8:
    Medicaid HCBS Waivers With and Without Personal Care Services,
    1998 HCBS Waivers That Offered Personal Care (44) No HCBS Waivers
    That Offered Personal Care (7) Source: American Public Human
    Services Association. Using a database compiled by the American
    Public Human Services Association (APHSA), we estimated that 118
    of the over 200 HCBS waivers provided personal care to almost
    331,000 individuals.19 The estimate of the number of recipients is
    likely to be an undercount, because as many as 16 waivers did not
    cite the number of enrollees. States had anywhere from 19Personal
    care is only 1 of over 25 different types of services offered
    under HCBS waivers. Because data on the costs associated
    specifically with personal care services within each waiver are
    not readily available, information on HCBS waivers and spending
    encompasses many related services. Page 24
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 one to six HCBS
    waivers offering personal care that varied greatly in the number
    of clients served and per capita cost, as shown in table 3. For
    example, the number of clients served ranged from a high of 35,000
    under one waiver to a low of 9 under another. Additionally, one-
    half of the waivers identified served fewer than 1,000
    individuals, indicating that most HCBS waivers were relatively
    small. Waivers that offered personal care were most likely to
    provide related services, such as respite services, environmental
    modifications, personal emergency response systems, and adult day
    health programs. Table 3: Range of Attributes of HCBS Waivers
    Offering Personal Care          Attribute
    Low               High            Average Services, 1998
    Clients served per waiver               9            35,000
    3,250 Per capita costs                     $663          $270,000
    $20,769 Waivers per state                       1
    6                 2.68 Source: APHSA. HCBS waivers are also likely
    to target a specific population or group of individuals. For
    example, over 50 percent of HCBS waivers offering personal care
    focused on (1) the elderly, people with physical disabilities, or
    both and (2) individuals with developmental disabilities;
    together, these two populations accounted for over 80 percent of
    consumers for HCBS waivers with personal care. Table 4 summarizes
    HCBS waivers with personal care by their target populations and
    number of consumers. Page 25
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Table 4:
    Selected Characteristics of HCBS Waivers With Personal Care,
    Percentage 1998
    Number of Percentage                 Number of
    of Target population                            waivers        of
    waivers       consumers          consumers Elderly, people with
    disabilities, or botha                              30
    25.4          174,969                 52.8 People with
    disabilities                            15              12.7
    17,631                 5.3 People with HIV/AIDSb
    12              10.2            13,726                 4.1 Elderly
    9               7.6           11,617                 3.5 People
    with developmental disabilities
    35              29.7          112,221                 33.9 People
    with traumatic brain injury
    13              11.0                916                0.3 Other
    4               3.4               387                0.1 Total
    118             100.0          331,467               100.0 aStates
    did not identify HCBS waiver populations consistently, so we
    created two categories of HCBS waivers for individuals with
    disabilities: one that identified only disability and one that
    served the elderly, people with disabilities, or both. bHuman
    immunodeficiency virus/acquired immunodeficiency syndrome. Source:
    APHSA. State Efforts to Target                 Recent litigation
    in federal courts has raised the possibility that the use of
    Services Have Been                      functional assessments in
    conjunction with HCBS waivers as a basis for Challenged Legally
    denying services to reduce or constrain costs may no longer be
    legally permissible in some circumstances under the Americans With
    Disabilities Act of 1990 (ADA).20 These cases raise questions
    about whether federal matching funds would be made available to
    meet added costs resulting from increased services that are
    outside a state's Medicaid plan. The ADA prohibits the exclusion
    of an individual with a disability from participating in public
    programs or receiving public benefits by reason of the person's
    disability. Department of Justice regulations implementing this
    provision require that "a public entity shall administer services,
    programs, and activities in the most integrated setting
    appropriate to the needs of qualified individuals with
    disabilities."21 Justice has recently reiterated that the "most
    integrated setting" standard applies to states, 2042 U.S.C. 12131-
    12134. Sec. 12132 of the act states 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." 21See 28 C.F.R.
    35.130(d). Page 26
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 including state
    Medicaid programs. The court cases reflect the application of this
    provision to specific state programs for individuals with
    disabilities. Courts in both Georgia and Pennsylvania have applied
    Justice regulations and found that institutional placement may
    violate the ADA if the placement does not constitute the most
    integrated setting appropriate to the needs of the individual.
    While only binding in the circuits involved, the court decisions
    have potentially broader implications for all states and their
    ability to place limits on the number of people that participate
    in waiver programs. On July 29, 1998, HCFA sent a letter to state
    Medicaid directors informing them of the following three Medicaid
    cases relating to the ADA and the most integrated setting
    standard. In L.C. By Zimring & E.W. v. Olmstead,22 patients in a
    state psychiatric hospital in Georgia filed suit challenging their
    placement in an institutional setting rather than in a community-
    based treatment program. The circuit court found that the
    placement in an institutional setting appeared to violate the ADA
    because it constituted a segregated environment, and that
    community placement could be required as a "reasonable
    accommodation" to the needs of the individuals. While the court
    emphasized that the state cannot justify the denial of community
    placement because of a lack of funding, it also acknowledged that
    the state need not provide these services if doing so would
    fundamentally alter the state's program.23 This case was remanded
    to the lower court for a determination of whether a fundamental
    alteration of the state program would occur as a result of the
    community placements.24 On a separate issue, this case was argued
    before the Supreme Court on April 21, 1999. The Court limited its
    review to the issue of whether the ADA compels the state to
    provide treatment for mentally disabled people in a community
    placement when appropriate treatment can also be provided to them
    in a state institution. 22L.C. By Zimring & E.W. v. Olmstead, 138
    F.3d 893 (11th cir.), rehearing and suggestion for rehearing en
    banc denied, 149 F. 3d 1197 (11th cir.), cert. granted, 119 S.Ct.
    617, order amended, 119 S.Ct. 633 (1998). 23See 28 C.F.R.
    35.130(b)(7). "A public entity shall make reasonable modifications
    . . . unless the public entity can demonstrate that making the
    modifications would fundamentally alter the nature of the service,
    program or activity." 24In its ruling, the circuit court put
    forward some issues the lower court should consider in determining
    if the state is meeting its burden of establishing that a
    fundamental alteration of the program would occur if community-
    based treatment was provided. One issue, among others, is whether
    the additional expenditures needed to treat the plaintiffs in the
    community would be unreasonable given the demands on the state
    mental health budget. Page 27
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 In Helen L. v.
    DiDario,25 a Medicaid nursing home resident alleged that the
    Pennsylvania Department of Public Welfare violated the ADA by
    requiring her to receive services in a nursing home rather than in
    her own home through a state-funded personal care program for
    which she qualified. The court held that the state's failure to
    provide services in the "most integrated setting" appropriate to
    the individual's needs violated the ADA. Additionally, the court
    found that the provision of personal care to the plaintiff would
    not fundamentally alter any state program because the services
    were already within the scope of an existing program. In Easely v.
    Snider,26 individuals with disabilities in Pennsylvania filed a
    lawsuit, through their representatives, challenging a requirement
    that they be mentally alert in order to participate in the state's
    personal care program. The court determined that given the
    essential goal of the program to foster independence for
    individuals limited by only physical disabilities, including
    individuals incapable of controlling their own legal and financial
    affairs in the program would constitute a fundamental alteration
    of the program. Therefore, the mental alertness requirement was
    found to be valid and not to violate the ADA. Of these three
    cases, only the last appears to uphold states' authority to limit
    the availability of Medicaid-funded services. In our interviews,
    state officials from both California and Maine expressed concern
    about the implications of these cases, as well as about Justice's
    "most integrated setting" standard. State officials' concerns
    center on states' ability to limit participation in their waiver
    programs. Maine officials noted that it is crucial that the state
    have the authority to define eligibility for services and to
    implement programs consistently with financial budgets, especially
    given the large number of individuals who have ADL limitations.
    State Approaches to      States have introduced consumer direction
    into their personal care Consumer Direction       programs as a
    means of ensuring that these services are tailored to the
    expressed needs and personal preferences of individual consumers.
    Reflect Similar Goals    Putting the consumer in the "driver's
    seat" is challenging for both and Challenges           individuals
    with disabilities and states. Officials we interviewed compared
    the skills required for consumer direction to those needed to run
    a small business. Overall, 31 states appear to offer some degree
    of consumer- directed personal care. The four states in our
    sample-California, Kansas, 25Helen L. v. DiDario, 46 F.3d 325 (3rd
    cir.), cert. denied, 516 U.S. 813 (1995). 26Easley v. Snider, 36
    F.3d 297 (3rd cir.), rehearing and rehearing en banc denied, 36
    F.3d 297, 306 (3rd cir. 1994). Page 28
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Maine, and
    Oregon-have extensive interest in or experience with consumer-
    directed personal care. Despite differences in their consumer-
    direction models, all four states have confronted similar issues
    surrounding the availability and quality of consumer-directed
    services: (1) ensuring a qualified pool of personal caregivers for
    what are typically relatively low-wage positions that often
    attract individuals with little or no training and (2) balancing
    state concerns regarding consumer safety with the consumers' right
    to self-direct their own care. Consumer Direction Can
    Consumer direction entails some degree of decision-making on the
    part of Be Analogous to Operating    consumers about the specific
    services they need and want and about a Small Business
    whether individual caregivers are appropriate for the job and
    capable of delivering those services satisfactorily. Thus, at a
    minimum, consumer direction means that the consumer defines the
    services to be delivered and makes employment decisions about
    caregivers. In contrast, under the traditional system of personal
    care delivered by a home health or other agency, people with
    disabilities are typically constrained by the agency's choice of
    caregivers, the schedules of these staff, and agency policies
    limiting available services. Consumers and state officials both
    told us that self-direction is analogous to operating a small
    business, in that consumers may have to select, hire, train, and
    manage their own caregivers. (See fig. 9.) Page 29
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 9: Self-
    Direction Can Be Analogous to Operating a Small Business
    Select and Hire Personal Caregivers * Prepare job descriptions for
    the services required. * Decide how to advertise for and recruit
    job applicants, including through word of mouth, churches,
    colleges, newspapers, and bulletin boards. * Screen job applicants
    either by phone or in person, checking references and interviewing
    applicants that appear qualified. Train and Manage Personal
    Caregivers * Provide necessary training and management for
    personal caregivers to assist with self-care and daily living
    tasks. * Plan and coordinate schedules of possible multiple
    caregivers to ensure needed coverage. * Monitor absences and
    tardiness; collect, approve, and submit time sheets to state or
    local authorities for payment; in some cases, oversee deduction
    and withholding of payroll and income taxes; and ensure paychecks
    are provided. * Develop contingency plans to use when the personal
    caregivers are ill, have a personal emergency, or will be absent
    for other reasons. * Evaluate job performance, including
    responsiveness to consumer direction. * Discharge the caregivers
    if performance is not acceptable. Depending in part on the nature
    and degree of the disability, the consumer may have to retain the
    services of multiple personal caregivers to provide sufficient
    hours of care to meet ongoing needs as well as to respond to
    emergencies. For example, a consumer may need assistance in both
    the morning and evening, a situation that would probably result in
    the need for more than one caregiver. In one case, we were told
    that a person with quadriplegia required the services of 12
    different personal caregivers over the course of a week. An
    employed individual with disabilities with whom we met told us
    that he has five different caregivers. In Maine, 479 consumers
    collectively employ over 2,000 personal caregivers. Over Half the
    States               We identified 31 states, shown in figure 10,
    that offered consumer-directed Include Some Consumer
    personal care, primarily under Medicaid. A review of the
    literature shows Direction for Personal             that states
    have different approaches to consumer direction. For example, Care
    Services                      consumer direction in one state may
    mean that a consumer participates in preparing a service plan and
    can assist in recruitment. In other states and programs, consumers
    may also screen caregivers, negotiate compensation, Page 30
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 and train
    caregivers.27 To date, little systematic evaluation of the
    effectiveness of and costs associated with consumer-directed
    personal care has taken place; a demonstration is under way,
    however, that should provide insights on this approach to
    community-based personal care services. The Robert Wood Johnson
    Foundation, in cooperation with the Department of Health and Human
    Services (HHS), is sponsoring a four-state demonstration and
    evaluation of the cost-effectiveness and appeal of a consumer-
    directed approach to personal care services in Medicaid. Appendix
    VI summarizes the implementation progress of this demonstration in
    Arkansas, Florida, New Jersey, and New York. 27See Susan A.
    Flanagan and Pamela S. Green, Consumer-Directed Personal
    Assistance Services: Key Operational Issues for State CD-PAS
    Programs Using Intermediary Service Organizations (Washington,
    D.C.: Department of Health and Human Services, Oct. 24, 1997),
    app. V-1, exhibit D, pp. 8-12. Page 31
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Figure 10:
    Consumer-Directed Personal Care in the States Washington, D.C.
    Consumer-Directed Personal Care Identified (31) No Consumer-
    Directed Personal Care Identified (20) States in Our Sample
    The four states that we visited offer several different approaches
    to Approach Consumer                        consumer direction
    that vary in the consumers targeted and the extent to Direction
    Differently                    which consumers have a choice about
    self-direction. In addition, these states offered different
    supportive services to help consumers manage their care and
    oversee their caregivers, as well as different levels of consumer
    participation in the payroll process. California
    Under California's county-based system, 96 percent of personal
    care (and related services) is self-directed, with consumers
    having various levels of access to supportive services. State
    officials told us, however, that regulations require that all
    counties evaluate consumers regarding their Page 32
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 ability to self-
    direct and, if counties determine consumers are incapable, they
    are referred for special assistance. Of California's 58 counties,
    16 offer service delivery models other than self-direction that
    are based upon county assessments of consumers' needs. In these 16
    counties, consumers may also select providers from either the
    contracting agency or the counties' contracted providers. Twenty-
    three counties offer supported individual provider services, which
    use state funds to provide additional administrative and support
    services for consumers using independent providers. Supported
    individual provider services enhance service delivery through
    recruitment, provider list development and maintenance,
    orientation classes, supervision assistance, and consumer-to-
    independent-provider matching services. In addition, six counties
    have opted to form public authorities,28 which are enhanced
    independent provider models, and provide additional client
    assistance and increased compensation for providers.29 In other
    counties, few such services are available. Kansas    The degree of
    self-direction in Kansas ranges from a low of 10 percent of people
    with developmental disabilities to a high of 70 percent of those
    with physical disabilities. The frail elderly fall in between,
    with 30 percent self-directing their care. Consumers choosing
    self-direction manage all aspects of their care except paying
    personal caregivers, which is generally the responsibility of
    community organizations that serve as payroll agents. Consumers
    are given lists of payroll agents from which they may choose.
    Consumers may consult with Centers for Independence for help with
    determining how comfortable they are with living independently in
    the community and with self-direction. Maine     Maine gives
    consumers an initial choice regarding self-direction. Consumers
    choosing to self-direct must then decide between two models. Under
    one model, all consumers must agree to participate in the most
    extensive consumer-directed program we reviewed, which requires
    clients to be responsible for training and developing job
    descriptions for their caregivers as well as for performing actual
    payroll management functions. These consumers receive a voucher
    check twice a month from the state based on time sheets that they
    submitted.30 Personal caregivers are hired by the consumers and
    trained on the job by the consumers to assist with 28Public
    authorities are relatively new; the San Francisco Public Authority
    first met in Oct. 1995, and Los Angeles passed its ordinance in
    Oct. 1997. 29In California, counties exercise control over many
    aspects of personal care. Not only do they administer the personal
    care program, they are also responsible for 17.5 percent of costs
    and decide what supportive services will be available to
    consumers. 30A voucher check is a two-party check that the
    consumer signs over to the caregiver. Page 33
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 daily
    activities. Under the second model, consumers may choose between
    more limited self-direction and agency provision of service.
    Oregon    In Oregon, consumer-directed providers, over whom
    clients have ultimate hiring and firing authority, provide over 91
    percent of in-home services. These providers are paid directly by
    a state agency, and, thus, consumers have minimal involvement in
    the payroll process. However, consumers of Medicaid in-home care
    do verify that the authorized hours of work were performed by
    signing workers' time sheets. In Oregon, case managers play a
    significant role in ensuring a successful community-based
    placement. Consumers work with case managers to obtain the set of
    services that best meets their functional needs. Oregon reports a
    staffing standard of one case manager for each 69 in-home clients-
    approximately one-half of the staffing standard for nursing
    facility clients. Case managers can also arrange for in-home
    agency providers to assist in case of an emergency. Finally,
    Oregon has a "Client Employed Provider Guide for Employees" that
    helps clients select, hire, and direct caregivers. The four
    states' approaches are summarized in table 5. Page 34
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Table 5:
    Variation in Consumer Direction of Personal Care in Four
    Consumer            Supportive           Payroll States
    Populations                direction           services
    done by State                   served
    available           availablea           consumer California
    People with                Yes, in all 68      Yes, in at least
    Less than 1 physical                   counties; 16        23
    countiesb         percent disabilities and the counties have frail
    elderly              additional service delivery modes. Kansas
    People with                Optional            Yes
    No physical disabilities and developmental disabilities and the
    frail elderly Maine                   People with
    Mandatory           Yes, but limited Yes, under physical
    under one           under one            one model disabilities
    and the model; optional model frail elderly              under
    other model Oregon                  People with
    Optional            Yes                  No physical disabilities
    and developmental disabilities, the frail elderly, and people with
    mental illness aSupportive services include assistance in
    recruiting and hiring, training, and day-to-day management of
    caregivers. bCalifornia services are decentralized to the county
    level and thus vary in the degree of available supportive
    services. States Recognize Multiple             Despite
    differences in their models of consumer direction, the four states
    Factors Influencing the               we visited share concerns
    about ensuring the quality of care and Quality of Personal Care
    safeguarding individuals with disabilities. There is a general
    consensus among state officials, consumers, and advocates that
    working conditions-including low wage levels and lack of fringe
    benefits-often make it very difficult to recruit and retain
    qualified caregivers.31 Despite these states' commitment to
    transfer authority over key aspects of personal care to the
    consumer, there is less consensus among these same groups on
    whether and how other quality control measures, such as background
    checks and service monitoring, should be implemented. Each
    31Additionally, state officials, consumers, and advocates reported
    that it is often difficult to arrange for backup when caregivers
    do not show up for work. Page 35
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 state recognizes
    the special challenges posed by monitoring services delivered in a
    home-based setting and by serving a population that includes
    consumers who have mental impairments. Furthermore, little
    consensus existed among state officials, consumers, and advocates
    regarding the degree to which government should actively protect
    consumers with disabilities. Compensation of Caregivers
    Among the concerns most often raised by state officials,
    consumers, and Has Implications for Quality of      advocates in
    three of the four states we visited are the low wages and Care
    limited fringe benefits available to caregivers and the
    implications of these factors for the quality of care consumers
    receive. Any decision about caregiver compensation inevitably must
    be made in a context of funding limitations. The quantity of
    services available is related in large part to the cost of those
    services-and labor is by far the largest component of the cost of
    personal care. Three of the four states told us that they were
    uncomfortable with caregiver pay levels, indicating that low wages
    could reduce the quality and consistency of care. Only in Kansas
    did there seem to be general agreement that personal caregiver
    wage rates were adequate. At the time of our visits, the hourly
    wages for personal care when provided under consumer-directed
    (nonagency) arrangements were as follows: * California paid $5.75,
* Kansas paid varying wages, * Maine paid $6.25, and * Oregon paid
    $6.50 to $6.72.32 In California, counties have the option of
    increasing the personal caregiver's hourly wage using local
    revenues, without any state contribution to the increase. Only San
    Francisco has augmented the wage level-to $7. Several other
    counties are currently considering increases. In addition,
    California has chosen to use state revenues to pay relatives for
    providing personal care to people who are otherwise eligible for
    Medicaid reimbursement.33 One study, which found positive outcomes
    for consumers self-directing their caregivers, estimated that over
    40 percent of consumer-directed personal care providers in
    California are family 32Oregon has a tiered payment system
    reflective of clients' care needs. At the time of our visit,
    Oregon rates were $6.50 per hour for minimal assistance with ADL
    and IADL care needs and $6.72 per hour for full assistance with
    ADL care. As of Feb. 1, 1999, Oregon increased its rates to $7.80
    and $8.02, respectively. 33HCFA generally prohibits Medicaid
    payments to spouses or parents of beneficiaries who provide care.
    Page 36                                                 GAO/HEHS-
    99-101 Severely Disabled Adults B-280728 members.34 Family members
    are more likely to undertake such a responsibility, in part, for
    altruistic reasons, and thus the low compensation may be more
    appropriately viewed as a recognition of this fact rather than as
    an actual salary. In Kansas, under the HCBS waiver for people with
    physical disabilities, caregivers are paid between $8.25 and
    $13.25 per hour. The specific amount is determined by the consumer
    and his or her independent living counselor and reflects in part
    the severity of the consumer's disability. These amounts are
    essentially ceilings; caregivers are typically paid at lower
    levels. For example, for personal care arranged through the Topeka
    Independent Living Center, wages range from $7 to $10. Part of the
    reason for the difference between these rates and the maximum
    allowed by the state is that the Center pays for workers'
    compensation and unemployment insurance from the remainder of the
    state allowance. The frail elderly waiver reimburses between
    $12.00 and $13.25, depending on the level of care the consumer
    requires; the waiver for people with developmental disabilities
    offers a flat hourly rate of $10.40. These amounts are then
    subject to withholding and insurance, resulting in the caregiver's
    receiving approximately $6 to $8. Few fringe benefits-such as
    workers' compensation, health insurance, and paid leave-are
    available for personal caregivers. Of the four states we visited,
    only California offers workers' compensation to all personal
    caregivers; Kansas offers selective coverage, depending in part on
    the choice of the consumer or vendor agency. In California, active
    consideration is being given to providing health insurance
    coverage; San Francisco began providing health insurance coverage
    in March 1999, and a few counties are also exploring health
    insurance options. None of the four states offers sick or vacation
    leave to consumer-directed personal caregivers. In two of the four
    states-Oregon and California-labor unions are attempting to
    organize the states' personal care workforces with the goal of
    improving wage and benefit levels. The unions face special
    challenges because of the extent of consumer direction, which
    results in a highly decentralized workforce. Of the two states,
    greater organizing progress has been made in California where, as
    of February 1999, personal caregivers in six counties, including
    Los Angeles, voted in favor of representation by the Service
    Employees International Union. In Oregon, 34A.E. Benjamin, R.E.
    Matthias, and T.M. Franke, Comparing Client-Directed and Agency
    Models for Providing Supportive Services at Home, report for the
    Assistant Secretary for Planning and Evaluation, HHS (Los Angeles,
    Calif.: Sept. 30, 1998). Page 37
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 the Oregon
    Public Employees Union, with the help of its umbrella
    organization, the Service Employees International Union, has
    submitted legislation to form a Home Care Providers Commission.
    One of the main functions of this commission would be to
    collectively bargain on behalf of client-employed providers. Views
    Differ on Monitoring      State and local agencies charged with
    paying for and regulating personal Service Quality
    care confront special challenges because of the basic
    characteristics of self-directed personal care, including the
    setting in which care is delivered and the nature of both the
    clientele and the workforce. Moreover, state efforts to intervene
    to protect consumers have engendered controversy across subgroups
    of the disability population and their advocates, some of whom
    view government oversight as intrusive. As a service delivered in
    individuals' homes, in diffuse settings, personal care is by
    nature more difficult to monitor than care delivered in a
    centralized setting to multiple individuals (for example, in a
    nursing home or adult day care center). Consumer direction further
    complicates the task of oversight because it leads to considerable
    variation and adjustment to individual circumstances, resulting in
    a less standardized "product." In addition, consumer-directed
    personal care requires closer monitoring than services provided
    through agencies, which are often obligated to ensure the
    qualifications and performance of their employees. Finally, at
    least some of the adult disabled and elderly populations have
    degrees of mental impairment that restrict or prohibit their
    ability to oversee their own affairs and may require some sort of
    special protection. Older consumers are sometimes at special risk
    because of dementia and depression, which can accompany the aging
    process. But some younger adults with disabilities also experience
    limitations in mental capacity, such as those associated with
    mental retardation and certain other developmental disabilities.
    Officials, Consumers, and       Recognizing their responsibility
    for protecting the most vulnerable Advocates See the Need to
    consumers of personal care-especially the elderly and mentally
    Balance Safety With Autonomy    impaired-state and local
    government officials with whom we spoke were generally inclined to
    support broad intervention strategies to protect consumers. Other
    things being equal, these officials seemed to prefer erring on the
    side of too much rather than insufficient protection. Although
    none of the four states we contacted was considering imposing
    licensure or certification requirements or demanding credentials
    for personal caregivers, efforts are being made to train personal
    caregivers as Page 38                                  GAO/HEHS-
    99-101 Severely Disabled Adults B-280728 a quality assurance
    measure in some of the states we visited. The importance of
    training is exemplified by caregivers' frequent need to assist
    consumers in rising from beds or chairs or in moving about their
    homes. Without training in lifting or transferring techniques,
    workers may injure themselves or the people for whom they are
    caring. To some extent, a pivotal issue in the consumer protection
    debate is tolerance of risk to the consumer's personal safety.
    Some consumers and advocates are more willing to tolerate risk if
    it allows greater personal autonomy, while others believe that
    protection of vulnerable consumers must take priority.35 Those on
    both sides of the issue seem willing to concede, however, that
    exceptions can and should be made, and individual circumstances
    should ultimately govern policy. Maine officials noted concerns
    about the liability of caregivers who provide services in
    accordance with consumers' instructions that may not meet quality
    or safety standards. In this regard, Maine officials stated that
    nurses have raised similar concerns.36 Conclusions         Our
    review of federal and state approaches to providing personal care
    in home- and community-based settings suggests that the
    willingness and capacity to do so exist. Increasingly, states are
    taking advantage of the flexibility available through the use of
    Medicaid HCBS waivers to design and target programs to individuals
    with disabilities that meet unique state needs. The personal care
    programs we examined in California, Kansas, Maine, and Oregon
    reflect the diversity of approaches and can serve as useful models
    for other states that may wish to expand the delivery of services
    in noninstitutional settings and emphasize consumer participation
    in directing services to meet their own care needs. Agency and
    State    HCFA and the four states we visited were given an
    opportunity to review a Comments            draft of this report.
    They generally agreed with our description of individuals with
    disabilities and the federal programs providing services. HCFA
    identified several areas in which the report could be clarified.
    As a result, we revised language addressing (1) home health
    services under 35In particular, the subject of criminal background
    checks for personal caregivers is a controversial issue. Advocates
    for younger adults with physical disabilities see this idea as
    unnecessary and overly intrusive, while state officials and other
    advocates see it as imperative to protect vulnerable consumers.
    Within these groups there is also skepticism about the efficacy of
    background checks given the incompleteness of criminal justice
    databases. Other difficulties surrounding the issue include the
    expense of such background checks as well as reluctance at the
    state and local levels to fund them. 36In this case, nurses are
    not supervising the caregiver but are providing in-home nursing
    care. Page 39
    GAO/HEHS-99-101 Severely Disabled Adults B-280728 Medicare and
    Medicaid and (2) the PCS benefit option under Medicaid. We
    incorporated other technical comments from both HCFA and the
    states as appropriate. We are sending copies of this report to the
    Honorable Donna E. Shalala, Secretary of Health and Human
    Services; the Honorable Nancy-Ann Min DeParle, Administrator of
    HCFA; appropriate congressional committees; and other interested
    parties. If you or your staff have any questions about this
    report, please call me at (202) 512-7118 or Walter Ochinko,
    Assistant Director, Health Financing and Public Health Issues, at
    (202) 512-7157. Other major contributors are listed in appendix
    VII. Kathryn G. Allen Associate Director, Health Financing and
    Public Health Issues Page 40
    GAO/HEHS-99-101 Severely Disabled Adults Page 41      GAO/HEHS-99-
    101 Severely Disabled Adults Contents Letter
    1 Appendix I
    46 Objectives, Scope, and Methodology Appendix II
    50 Federal Programs Directed Specifically at Individuals With
    Disabilities Appendix III
    58 Other Federal Programs With Disability as a Criterion for
    Eligibility Appendix IV
    68 Medicaid Expenditures for Personal Care and Related Services
    Appendix V
    71 States' Use of Home Health, the PCS Benefit, and HCBS Waivers
    Page 42      GAO/HEHS-99-101 Severely Disabled Adults Contents
    Appendix VI
    82 Cash and Counseling Demonstration and Evaluation Appendix VII
    87 Major Contributors to This Report Tables
    Table 1: Beneficiaries' Use of Medicare Home Health Aides, 1996
    16 Table 2: States' Use of the PCS Benefit, Ranked by Percentage
    of             22 Total Medicaid Community-Based Expenditures,
    Fiscal Year 1998 Table 3: Range of Attributes of HCBS Waivers
    Offering Personal               25 Care Services, 1998 Table 4:
    Selected Characteristics of HCBS Waivers With Personal
    26 Care, 1998 Table 5: Variation in Consumer Direction of Personal
    Care in                 35 Four States Table IV.1: Medicaid
    Community-Based Expenditures, Fiscal Year               69 1998
    Table V.1: Limits Imposed Under the Medicaid Home Health
    72 Benefit Table V.2: Limits Imposed Under the Medicaid PCS
    Benefit                     75 Table V.3: Clients Served by
    Medicaid HCBS Waivers With                      77 Personal Care,
    1997 Table VI.1: Consumer Interest in a Cash Model
    85 Figures                  Figure 1: Estimates of Number of
    Adults With Severe Disabilities,             9 1994-95 Figure 2:
    Selected Characteristics of Adults With Severe
    10 Disabilities Compared With Those of the General Population,
    1994-95 Figure 3: Adults With Severe Disabilities Covered by
    Public                  12 Health Insurance, 1994-95 Figure 4:
    Distribution of the Estimated $110 Billion Designated
    14 Specifically for Individuals With Disabilities, by Budget
    Function, Fiscal Year 1999 Figure 5: Medicare Home Health
    Expenditures, 1981-97                         15 Page 43
    GAO/HEHS-99-101 Severely Disabled Adults Contents Figure 6:
    Comparison of Growth in Medicare and Medicaid Home
    18 Health Expenditures, 1987-97 Figure 7: States Offering the PCS
    Benefit, 1998                                  20 Figure 8:
    Medicaid HCBS Waivers With and Without Personal
    24 Care Services, 1998 Figure 9: Self-Direction Can Be Analogous
    to Operating a Small                   30 Business Figure 10:
    Consumer-Directed Personal Care in the States
    32 Figure IV.1: Growth in Medicaid Expenditures for Personal Care
    68 and Related Services, 1987-98 Abbreviations ADA
    Americans With Disabilities Act of 1990 ADL           activities
    of daily living AIDS          acquired immunodeficiency syndrome
    APHSA         American Public Human Services Association ARC
    AIDS-related complex CCDE          Cash and Counseling
    Demonstration and Evaluation HCBS          home- and community-
    based services HCFA          Health Care Financing Administration
    HHS           Department of Health and Human Services HIV
    human immunodeficiency virus HUD           Department of Housing
    and Urban Development IADL          instrumental activities of
    daily living NHIS          National Health Interview Survey PCS
    personal care services VA            Department of Veterans
    Affairs Page 44                                     GAO/HEHS-99-
    101 Severely Disabled Adults Page 45      GAO/HEHS-99-101 Severely
    Disabled Adults Appendix I Objectives, Scope, and Methodology To
    estimate the number of people with severe disabilities, we
    reviewed several national surveys, including the Medical
    Expenditure Panel Survey, the Survey of Income and Program
    Participation, and the Medicare Current Beneficiary Survey. We
    selected the 1994 and 1995 National Health Interview Surveys
    (NHIS) for analysis in part because individuals were asked to
    report the level of difficulty they had in performing activities
    of daily living (ADL) and instrumental activities of daily living
    (IADL), thus providing some measure of the severity of their
    conditions. NHIS also provided information regarding individuals'
    need for personal care and related assistance with ADLs and IADLs,
    as well as data on individuals' ability to work. NHIS data report
    on noninstitutionalized individuals; thus, our sample excludes
    individuals residing in nursing homes or other institutions. By
    combining 2 years of NHIS data, we were able to increase the
    sample size and decrease the sampling standard error of our
    estimates. Because our estimate of the number of individuals with
    severe disabilities is based on a sample of the population, it is
    subject to sampling errors. The highest standard error (a measure
    of sampling error) of our population estimates was +/- 1.6 percent
    of total estimates. For our comparison of the demographics of
    individuals with severe disabilities with those of the general
    population, the percentage sampling error was within a 95-percent
    confidence interval. Finally, we did not verify the accuracy of
    the survey data; however, NHIS is a recognized national survey
    instrument with established procedures in place to ensure a
    reasonable level of reliability of estimates. We consulted with
    national research organizations and interest groups regarding a
    definition of individuals with severe disabilities, obtaining
    input on the advisability of including both ADL and IADL
    components. Despite the fact that NHIS specifically asks about
    supervision of ADLs, research and advocacy organizations believed
    that an IADL component was necessary to better ensure that
    individuals with mental or cognitive impairments were represented
    in our sample. On the basis of these discussions and our research,
    we defined an adult with severe disabilities as an individual who
    reported either a lot of difficulty with performing or inability
    to perform either (1) three or more ADLs or (2) two ADLs and four
    IADLs. In some cases, individuals with mental impairments, such as
    developmental disabilities, mental illness, and other conditions,
    can physically perform ADLs, IADLs, or both, but supervision or
    oversight is necessary to ensure that self-care is safely,
    consistently, and appropriately performed. Although we relied on a
    definition that included IADLs, our estimates maintained a
    predominant focus on ADLs because of Page 46
    GAO/HEHS-99-101 Severely Disabled Adults Appendix I Objectives,
    Scope, and Methodology their close tie to personal care needs. In
    this regard, the definition applied for this report is more
    heavily weighted toward individuals with physical impairments. To
    identify federal programs for which people with disabilities are
    likely to qualify, we reviewed the December 1998 Catalog of
    Federal Domestic Assistance (Washington, D.C.: General Services
    Administration, Dec. 1998) for program descriptions containing
    variations of the terms "disability" and "handicap." The catalog
    is a governmentwide compendium of federal programs, projects,
    services, and activities that provide assistance or benefits to
    the American public. It contains financial and nonfinancial
    assistance programs administered by departments and other entities
    of the federal government. We included in our program count cash
    assistance, grant, and direct service programs for which adults
    with disabilities are eligible. Grants and activities for children
    were excluded because our focus was on adults. In addition, we did
    not include research, affirmative action and advocacy, and
    architectural barriers and compliance programs because they do not
    involve the direct provision of cash, benefits, or other services
    to people with disabilities.37 We subsequently divided the
    identified grants and activities into two groups: (1) those for
    which disability was the primary condition of program
    participation and (2) those for which program participation did
    not depend solely on an individual's having disabilities.38 We
    compiled estimated federal expenditures for the first group to
    arrive at a total federal commitment of $110 billion for fiscal
    year 1999. We did not determine the amount of estimated
    expenditures for the second group because eligibility for these
    programs did not depend only on disability. To identify the amount
    and type of personal care provided under Medicaid and Medicare, we
    reviewed both existing research and Health Care Financing
    Administration (HCFA) expenditure reports. For the Medicaid home
    health and personal care services (PCS) benefits, we used HCFA 64
    37Our search yielded several grants and activities that were not
    directly related to individuals with disabilities. For example,
    some programs contained a generic statement regarding the
    illegality of discriminating against individuals with
    disabilities. We did not include such programs in our count. 38The
    Supplemental Security Income program provides cash benefits to
    individuals with disabilities or those who are aged. Because 77
    percent of the participants in this program have disabilities, we
    included this percentage of expenditures in our calculations of
    federal commitments to individuals with disabilities. Page 47
    GAO/HEHS-99-101 Severely Disabled Adults Appendix I Objectives,
    Scope, and Methodology and 2082 data sources on expenditures and
    recipients.39 Using the Commerce Clearing House, Inc., Medicare
    and Medicaid Guide, we identified states offering the PCS benefit
    and grouped them by the eligibility categories and service limits
    imposed by each state. To identify home- and community-based
    service (HCBS) waivers, we used an August 1998 database maintained
    by the American Public Human Services Association (APHSA). We then
    summarized available cost and recipient data on HCBS waivers.
    However, not all waivers in the database had cost data and
    recipient counts; hence, data on HCBS waivers are likely to
    represent an undercount of consumers and expenditures. To identify
    states with consumer-directed services, we reviewed the APHSA
    database of waivers, conducted a literature search, and contacted
    research and advocacy organizations. To examine how a select group
    of states directs personal care services to those most in need and
    how these states have implemented consumer direction, we conducted
    an extensive literature review and held discussions with research
    and advocacy organizations. We selected our state sample with the
    purpose of identifying a range of considerations, including states
    that * were identified as leaders in offering consumer-directed
    personal care; * offered HCBS waivers with personal care, with a
    broad range in per capita spending; * made significant use of the
    PCS benefit under Medicaid; and * targeted a mixture of
    populations, such as the aged, those with disabilities, and those
    with mental disabilities. Our objective was to select states
    representing a broad diversity of approaches to personal care and
    consumer direction. Thus, we selected California in part because
    of its extensive use of the PCS benefit, and Oregon because of its
    extensive use of an HCBS waiver. Maine and Kansas afforded
    additional variety in their use of multiple HCBS waivers and
    differences in their use of the PCS benefit. During our fieldwork,
    we met with state and local agencies, interest groups, consumers,
    and unions representing or seeking to represent caregivers in
    order to obtain a variety of perspectives on the services and
    programs offered in each state. In our discussions, we focused on
    strategies for monitoring services and 39HCFA 64 is a quarterly
    Medicaid expenditure report that summarizes data submitted by the
    states. HCFA 2082 is an annual statistical report with data on
    Medicaid eligibles, recipients, services, and expenditures derived
    from the states and summarized by HCFA. We did not verify the
    accuracy of HCFA expenditure reports. Page 48
    GAO/HEHS-99-101 Severely Disabled Adults Appendix I Objectives,
    Scope, and Methodology targeting client populations, and we asked
    each group and organization to highlight areas of concern
    regarding consumer-directed services. Page 49
    GAO/HEHS-99-101 Severely Disabled Adults Appendix II Federal
    Programs Directed Specifically at Individuals With Disabilities
    Using a compilation of 237 programs from the Catalog of Federal
    Domestic Assistance, we identified 30 programs, services, and
    activities that target individuals with disabilities. These
    programs are identified below by budget function and estimated
    fiscal year 1999 expenditures. Three programs-Social Security
    Disability Insurance, Supplemental Security Income, and Veterans
    Compensation for Service-Connected Disability-account for 86
    percent of the funds obligated. Education, Training, Employment,
    and Social Services Budget Subfunction        Books for the Blind
    and Physically Handicapped ($48.1 million). 503-Research and
    Provides library services to the blind and physically handicapped
    by General Education Aids    offering cassette players and books
    on cassettes, on disks, and in Braille. Budget Subfunction
    Rehabilitation Act: Independent Living Centers ($46.1 million).
    506-Social Services       Provides grants for establishing and
    operating statewide networks of centers for independent living to
    help people with severe disabilities function more independently
    in family and community settings. Core services provided must
    include information and referral services, training in independent
    living skills, peer counseling, and individual and system
    advocacy. The governing board and the majority of staff and
    individuals in decision-making positions must be individuals with
    disabilities. Rehabilitation Act: Independent Living State Grants
    ($22.3 million). Provides grants to help states promote a
    philosophy of independent living, consumer control, peer support,
    self-help, self-determination, equal access, and individual and
    system advocacy. Independent living funds are used to support the
    statewide Independent Living Council and to maximize the
    leadership, empowerment, independence, and productivity of
    individuals with disabilities, as well as the integration and full
    inclusion of individuals with disabilities into mainstream
    American society. Rehabilitation Act: Independent Living Services
    for Older Individuals Who Are Blind ($11.2 million). Provides
    project grants to authorized state agencies to provide
    rehabilitation services to individuals Page 50
    GAO/HEHS-99-101 Severely Disabled Adults Appendix II Federal
    Programs Directed Specifically at Individuals With Disabilities
    aged 55 and over who are blind, or whose severe visual impairments
    make competitive employment extremely difficult to attain, but for
    whom independent living in their own homes or communities is
    feasible. Services provided include (1) those designed to help
    correct or modify visual disabilities, (2) eyeglasses and other
    visual aids, (3) services and equipment to enhance mobility and
    self-care, and (4) training in Braille. Rehabilitation Services-
    Vocational Rehabilitation Grants ($2.3 billion). Assists states in
    providing vocational rehabilitation services and goods, including
    assessment, counseling, vocational and other training; job
    placement; reader services for the blind; interpreter services for
    the deaf; medical and related services; prosthetic and orthotic
    devices; rehabilitation technology; transportation to vocational
    rehabilitation sites; maintenance during rehabilitation; and other
    goods and services necessary for an individual with a disability
    to prepare for and engage in competitive employment.
    Rehabilitation Act: American Indians With Disabilities ($17.6
    million). Provides project grants to governing bodies of American
    Indian tribes for vocational rehabilitation services for Indians
    with disabilities who reside on federal or state reservations to
    prepare them for suitable employment. Projects funded are for
    services over and above those provided by the Rehabilitation Act
    Basic Support Program, which is administered by the states, and
    include on-the-job training through tribal industries; support for
    self-employment in food services, crafts, and other enterprises;
    and special vocational and academic training through tribal
    colleges. Projects generally require 10-percent matching funds in
    cash or in kind. Rehabilitation Act: Special Projects and
    Demonstrations for Providing Vocational Rehabilitation Services to
    Individuals With Severe Disabilities ($18.9 million). Provides
    grants to states and public and other nonprofit organizations for
    projects and demonstrations that expand or improve vocational
    rehabilitation and other rehabilitation services for individuals
    with disabilities-especially those with the most severe
    disabilities. Projects may also be conducted to meet the special
    needs of individuals that are unserved or underserved.
    Developmental Disabilities Projects of National Significance ($5.3
    million). Provides grants and contracts for the development of
    national and state policy that enhances the independence,
    productivity, and integration and inclusion into the community of
    people with Page 51                                      GAO/HEHS-
    99-101 Severely Disabled Adults Appendix II Federal Programs
    Directed Specifically at Individuals With Disabilities
    developmental disabilities. Project grants have been used to
    educate policymakers, fund federal interagency initiatives,
    enhance minority participation in public and private sector
    initiatives on developmental disabilities, and provide technical
    assistance and data collection and analysis. Funded projects
    include the provision of personal assistance services to
    individuals with disabilities. Rehabilitation Act: Service
    Projects ($5.9 million). Provides grants to state vocational
    rehabilitation agencies and public nonprofit organizations for
    projects and demonstrations that hold promise for expanding or
    improving vocational and other rehabilitation services for
    individuals with severe disabilities over and above the services
    provided by the Rehabilitation Act Basic Support Program. Projects
    provide financial assistance for vocational rehabilitation
    services to migratory agricultural or seasonal farmworkers and for
    projects that initiate integrated programs of recreation for
    individuals with disabilities. Rehabilitation Act: Projects With
    Industry ($22.1 million). Awards grants to employers, labor
    unions, for-profit and nonprofit organizations, institutions, and
    state vocational rehabilitation agencies to create and expand job
    and career opportunities for individuals with disabilities in the
    competitive labor market by joining with private industry to
    provide job training and placement, as well as career advancement
    services. A 20-percent match is required. Rehabilitation Act:
    Supported Employment Services for Individuals With Severe
    Disabilities ($38.2 million). Provides formula grants for time-
    limited services leading to supported employment for individuals
    with the most severe disabilities. Funds are used to provide (1)
    services complementary to title I of the Rehabilitation Act, (2)
    skilled job trainers who accompany workers for intensive on-the-
    job training, (3) systematic training, (4) job development, (5)
    follow-up services, (6) regular observation or supervision at
    training sites, and (7) other services needed to support an
    individual in employment. Senior Companion Program ($35.2
    million). Provides grants to state and local agencies and private
    nonprofit organizations to afford income-eligible people, aged 60
    and older, the opportunity to provide personal assistance and
    companionship to other seniors through volunteer service; provide
    nonmedical personal support to adults who, without support, might
    be inappropriately placed in long-term care facilities; help
    people who have been discharged from health care facilities and
    other Page 52                                       GAO/HEHS-99-
    101 Severely Disabled Adults Appendix II Federal Programs Directed
    Specifically at Individuals With Disabilities institutions; and
    provide companionship to people with developmental disabilities
    and other special needs. The grants may be used for Senior
    Companion stipends, transportation, physical examinations,
    insurance, and meals; staff salaries, fringe benefits, and travel;
    equipment and space; and so on. Technology-Related Assistance
    State Grants ($30 million). Provides grants to states to help them
    develop and implement comprehensive, consumer-responsive statewide
    programs of technology-related assistance for individuals of all
    ages with disabilities. States may provide assistance to statewide
    community-based organizations or directly to individuals with
    disabilities. Income Security Budget Subfunction        Shelter
    Plus Care ($65 million). Provides project grants to states, units
    604-Housing Assistance    of local governments, Indian tribes, and
    public housing agencies to provide rental assistance, in
    connection with other supportive services funded from sources
    other than this program, to homeless people with disabilities.
    Rental assistance is available for tenant-based, sponsor-based,
    project-based, and single-room occupancy for homeless individuals.
    Supportive Housing for Persons With Disabilities (also appears
    under subfunction 371 for mortgage credit) ($174 million).
    Provides capital advances to finance the construction,
    rehabilitation, or purchase of buildings for supportive housing
    for people with disabilities for use as group homes. Project
    rental assistance is also used to cover any part of the Housing
    and Urban Development (HUD)-approved operating costs of a facility
    that is not met from project income. Multifamily Housing Service
    Coordinators (also appears under subfunction 451 for community
    development) ($6.5 million).40 Provides project grants to owners
    or managers of conventional public housing projects to hire
    service coordinators to link elderly and disabled assisted housing
    residents with supportive or medical services in the general
    community; prevent premature and unnecessary institutionalization;
    and assess individual service needs, determine 40Represents
    expenditures for FY 1998; estimated expenditures for FY 1999 were
    not available. Page 53
    GAO/HEHS-99-101 Severely Disabled Adults Appendix II Federal
    Programs Directed Specifically at Individuals With Disabilities
    eligibility for public services, and make resource allocation
    decisions that enable residents to stay in the community longer.
    Budget Subfunction         Supplemental Security Income ($21.4
    billion).41 Provides cash 609-Other Income           payments to
    ensure a minimum level of income to people who are aged 65
    Security                   or older or who are blind or disabled.
    Eligibility is based on an assessment of the individual's monthly
    income and resources, U.S. residency, and citizenship or alien
    status. Social Security Budget Subfunction         Social Security
    Disability Insurance ($57.3 billion). Replaces part of 651-Social
    Security        the earnings of qualified disabled workers under
    age 65 who are unable to engage in any substantial gainful
    activity because of a medically determinable physical or mental
    impairment that has lasted or is expected to last at least 12
    months, or to result in death. The program provides monthly cash
    benefits to eligible disabled people and eligible auxiliary
    beneficiaries, such as certain family members, throughout the
    period of disability. Costs of vocational rehabilitation are also
    paid for certain beneficiaries. Veterans' Benefits and Services
    Budget Subfunction         Veterans Compensation for Service-
    Connected Disability 701-Income Security for    ($15.3 billion).
    Compensates veterans for disabilities incurred or Veterans
    aggravated during military service according to the average
    impairment of earning capacity such a disability would cause in
    civilian occupations. Benefits are paid from when the injury
    occurred or disease was contracted as well as from the time a
    preexisting injury occurred or disease was contracted in the
    active military. Veterans Pension for Non-Service-Connected
    Disability ($2.3 billion). Assists wartime veterans in need whose
    41Represents expenditures for only the disabled Supplemental
    Security Income program population. Total program estimated
    expenditures for FY 1999 are $27.8 billion. Page 54
    GAO/HEHS-99-101 Severely Disabled Adults Appendix II Federal
    Programs Directed Specifically at Individuals With Disabilities
    non-service-connected disabilities are permanent and totally
    prevent them from obtaining substantial gainful employment.
    Veterans who have had 90 days or more of honorable active wartime
    service in the armed forces or who were released or discharged
    with less than 90 days of service because of a service-connected
    disability are eligible. Income restrictions are prescribed, and
    pensions are not payable to those whose estates are so large that
    it is reasonable that they could be used for maintenance. Budget
    Subfunction          Vocational Rehabilitation for Disabled
    Veterans ($403 million). 702-Veterans Education,     Provides all
    services and assistance necessary to enable service-disabled
    Training, and               veterans and those receiving treatment
    for a service-connected disability Rehabilitation
    pending discharge to achieve maximum independence in daily living
    and, to the maximum extent feasible, to become employable and to
    obtain and maintain suitable employment. Veterans' Specially
    Adapted Housing ($14.7 million). Assists certain severely disabled
    veterans in acquiring suitable housing units with special fixtures
    and facilities made necessary by the nature of the veterans'
    disabilities. For veterans with permanent, total, and compensable
    disabilities related to service, the Department of Veterans
    Affairs (VA) provides 50 percent of the cost to the veteran of the
    housing unit, land, fixtures, and allowable expenses up to a
    maximum grant of $43,000. The program also provides funds for
    certain adaptations and equipment not to exceed a maximum grant of
    $8,250. Automobiles and Adaptive Equipment for Certain Disabled
    Veterans and Members of the Armed Forces ($26.2 million). Provides
    financial assistance to certain service members and veterans with
    disabilities toward a one-time payment for an automobile or other
    conveyance and an additional amount for adaptive equipment deemed
    necessary to ensure the eligible person will be able to operate or
    make use of the automobile or other conveyance. Provides financial
    assistance to veterans with honorable service and service members
    on duty who have a service-connected disability due to the loss or
    permanent loss of use of one or both feet, the loss of one or both
    hands, or a permanent impairment of vision of both eyes to a
    prescribed degree. Budget Subfunction          Veterans Outpatient
    Care ($8.0 billion). Provides medical and dental 703-Hospital and
    Medical    services on an outpatient basis, including examination;
    treatment; certain Care for Veterans           home health
    services; podiatric, optometric, and surgical services; Page 55
    GAO/HEHS-99-101 Severely Disabled Adults Appendix II Federal
    Programs Directed Specifically at Individuals With Disabilities
    medicines; and medical supplies to veterans who are 50-percent or
    more service-connected disabled. Pre-bed care, posthospital care,
    and care to obviate the need for hospitalization for any condition
    must be furnished to veterans rated 30- or 40-percent service-
    connected disabled and those whose annual income does not exceed
    the pension rate of a veteran in need of regular aid and
    attendance. Several other groups of veterans also qualify for
    these benefits, and veterans whose eligibility falls within the
    discretionary category who agree to make a copayment can be
    furnished outpatient care, services, or both on a facilities- and
    resource-available basis. Veterans Prescription Service ($1.6
    billion). Provides eligible veterans (that is, veterans receiving
    Veterans Outpatient Care benefits) and certain dependents and
    survivors of veterans with prescription drugs and expendable
    medical supplies. Veterans receiving medications on an outpatient
    basis from VA facilities for treatment of a non-service-connected
    disability or condition are required to make a copayment of $2 for
    each supply of medication for 30 days or less. Veterans receiving
    medications for the treatment of a service-connected condition and
    veterans rated 50-percent or more service-connected disabled are
    exempt from this copayment requirement. Blind Veterans
    Rehabilitation Centers and Clinics ($59.8 million). Provides
    personal and social adjustment programs and medical or health-
    related services for eligible blind veterans at selected VA
    medical centers maintaining centers for rehabilitation of the
    blind. Veterans Prosthetic Appliances ($395.4 million). Provides
    through purchase or fabrication prosthetic and related devices,
    equipment, and services to disabled veterans to enable them to
    live and work as productive citizens. This assistance includes
    replacement and repair of devices; training in the use of
    artificial limbs; and provision of artificial eyes, wheelchairs,
    aids for the blind, hearing aids, braces, orthopedic shoes,
    eyeglasses, crutches and canes, medical equipment, implants,
    medical supplies, and automotive adaptive equipment. Budget
    Subfunction      Veterans Housing-Direct Loans for Certain
    Disabled Veterans 704-Veterans Housing    (amount not available).
    Provides direct loans of up to $33,000 to permanently and totally
    disabled veterans if (1) they are eligible for a VA Specially
    Adapted Housing grant, (2) a loan is necessary to supplement the
    Page 56                                      GAO/HEHS-99-101
    Severely Disabled Adults Appendix II Federal Programs Directed
    Specifically at Individuals With Disabilities grant, and (3) home
    loans from a private lender are not available in the area where
    the property is located. Budget Subfunction       Disabled
    Veterans' Outreach Program ($80 million). Provides 705-Other
    Veterans       formula grants to be used only for salaries and
    expenses and reasonable Benefits and Services    support of
    Disabled Veterans' Outreach Program specialists who shall be
    assigned only those duties directly related to meeting the
    employment needs of eligible veterans-that is, developing and
    promoting on-the-job training and apprenticeship positions within
    VA programs; providing outreach assistance to local employment
    service offices; promoting maximum employment opportunities for
    veterans; and providing job placement, counseling, testing, and
    job referral to eligible veterans, especially disabled veterans of
    the Vietnam era. General Government Budget Subfunction
    Rehabilitation Act: Federal Employment for Individuals With 805-
    Central Personnel    Disabilities (amount not available).
    Encourages federal agencies to Management               provide
    employment opportunities to individuals with physical, cognitive,
    or mental disabilities in positions for which they qualify. Page
    57                                      GAO/HEHS-99-101 Severely
    Disabled Adults Appendix III Other Federal Programs With
    Disability as a Criterion for Eligibility Forty federal programs
    include disability as one of many potential criteria for program
    participation. Within these 40 programs, Medicare and Medicaid are
    the most significant sources of federal funds that provide
    personal care services to individuals with disabilities. Commerce
    and Housing Credit Budget Subfunction       Rural Rental Housing
    Loans. Provides loans to construct or purchase 371-Mortgage Credit
    and substantially rehabilitate rental or cooperative housing or to
    develop manufactured housing projects that generally consist of
    two or more family units and any appropriate related facilities
    suitable for rural areas. Occupants must be low- or moderate-
    income families, the elderly, or individuals with disabilities.
    Loans may not be made for nursing, special care, or institution-
    type homes. Mortgage Insurance Rental Housing for the Elderly. HUD
    insures lenders against loss on mortgages approved under section
    231 of the National Housing Act to finance construction or
    rehabilitation of detached, semidetached, walk-up, or elevator-
    type rental housing designed for occupancy by the elderly or
    individuals with disabilities and consisting of five or more
    units. Mortgage Insurance Rental and Cooperative Housing for
    Moderate Income Families and Elderly. HUD insures lenders against
    loss on mortgages approved under section 221 of the National
    Housing Act to finance construction or rehabilitation of detached,
    semidetached, row, walk-up, or elevator-type rental housing
    containing five or more units and designed for occupancy by
    moderate-income families, the elderly, and individuals with
    disabilities. Budget Subfunction       Small Business Loans.
    Provides guaranteed loans to low-income small 376-Other
    Advancement    business owners; businesses located in areas of
    high unemployment; of Commerce              nonprofit sheltered
    workshops; and small businesses owned, being established, or being
    acquired by individuals with disabilities who are unable to obtain
    financing in the private credit marketplace. Page 58
    GAO/HEHS-99-101 Severely Disabled Adults Appendix III Other
    Federal Programs With Disability as a Criterion for Eligibility
    Transportation Budget Subfunction      Capital Assistance Program
    for Elderly Persons and Persons With 401-Ground
    Disabilities. Provides financial assistance in meeting the
    transportation Transportation          needs of elderly people and
    people with disabilities where public transportation services are
    unavailable, insufficient, or inappropriate. Education, Training,
    Employment, and Social Services Budget Subfunction      TRIO
    Student Support Services. Provides grants to institutions of 502-
    Higher Education    higher education for low-income, first-
    generation college students or students with disabilities who are
    in need of academic support in order to pursue a program of
    postsecondary education. Funds may be used to provide personal and
    academic counseling, career guidance, instruction, mentoring, and
    tutoring. Budget Subfunction      Job Training Partnership Act.
    Provides formula grants to states for 504-Training and
    establishing programs to prepare economically disadvantaged youth
    and Employment              adults facing serious barriers to
    employment for participation in the labor force by providing job
    training and other services that will result in increased
    educational and occupational skills, increased employment and
    earnings, and decreased welfare dependency. Not less than 65
    percent of the recipients shall be in one or more of the following
    categories: deficient in basic skills, recipients of cash welfare
    payments, school dropouts or students 1 or more years below grade
    level, individuals with disabilities, homeless or runaway youth,
    and youth who are pregnant or parenting. Employment Service.
    Provides formula grants to states to support a nationwide network
    of public employment offices to place people in employment by
    providing a variety of placement-related services. These services
    are available without charge to job seekers and to employers
    seeking qualified individuals to fill job vacancies. Workers and
    veterans with disabilities are entitled to special employment
    services. Page 59                                        GAO/HEHS-
    99-101 Severely Disabled Adults Appendix III Other Federal
    Programs With Disability as a Criterion for Eligibility Veterans'
    Employment Program. Provides grants to states to develop programs
    to meet the employment and training needs of veterans with
    service-connected disabilities, veterans of the Vietnam era, and
    veterans recently separated from military service. Budget
    Subfunction          Social Services Block Grant. Provides formula
    grants to enable each 506-Social Services         state to furnish
    the social services best suited to the needs of the individuals
    residing in the state. Federal block grant funds may be used to
    provide services for one of the following five goals: (1) prevent,
    reduce, or eliminate welfare dependency; (2) help individuals
    achieve or maintain self-sufficiency; (3) prevent neglect, abuse,
    and exploitation of children and adults; (4) prevent or reduce
    inappropriate institutional care; and (5) secure admission or
    referral for institutional care when other forms of care are not
    appropriate. Developmental Disabilities University Affiliated
    Programs. Provides grants to defray the cost of administration and
    operation of programs that (1) provide interdisciplinary training
    for personnel concerned with developmental disabilities; (2)
    demonstrate community services activities, which include training
    and technical assistance and may include direct services; (3)
    disseminate findings related to the provision of services; and (4)
    generate information on the need for further service-related
    research. Special Programs for the Older Americans Act, Title III,
    Part C, Nutrition Services. Provides formula grants to states to
    support nutrition services, including providing nutritious meals,
    nutrition education, and other appropriate nutrition services for
    older Americans in order to maintain their health, independence,
    and quality of life. Meals may be served in a congregate setting
    or delivered to the home to eligible individuals aged 60 and over
    and to individuals under age 60 if they are handicapped or
    disabled and reside with and accompany an older individual. Health
    Budget Subfunction          Medical Assistance Program. The
    Medicaid program provides formula 551-Health Care Services
    grants to states to provide financial aid for medical assistance
    on behalf of cash assistance recipients; children; pregnant women;
    individuals who are Page 60
    GAO/HEHS-99-101 Severely Disabled Adults Appendix III Other
    Federal Programs With Disability as a Criterion for Eligibility
    aged, blind, or disabled and who meet income and resource
    requirements; and other categorically eligible groups. States can
    elect to provide similar coverage to medically needy people who,
    except for income and resource limitations, would be eligible for
    cash assistance. Financial assistance is provided to states to pay
    for Medicare premiums and copayments and deductibles of qualified
    Medicare beneficiaries meeting certain income requirements. More
    limited financial assistance is available for certain Medicare
    beneficiaries with higher incomes. Medicare Budget Subfunction
    Medicare Hospital Insurance. Provides hospital insurance
    protection 571-Medicare          for covered services to people
    aged 65 or older, certain people with disabilities, and
    individuals with chronic renal disease. Hospital insurance
    benefits are paid to participating and emergency hospitals,
    skilled nursing facilities, home health agencies, and hospice
    agencies to cover the prospective payment amount or reasonable
    cost of medically necessary services furnished to individuals
    entitled under this program. People under age 65 who have been
    entitled for at least 24 months to Social Security disability
    benefits, or for 29 consecutive months to Railroad Retirement
    benefits on the basis of disability, are eligible for hospital
    insurance benefits. Medicare Supplementary Medical Insurance.
    Provides supplementary medical insurance to all people aged 65 or
    older; certain people with disabilities, whether insured under
    Medicare Hospital Insurance or not, may voluntarily enroll for
    this supplemental insurance. Medicare generally pays 80 percent of
    the approved amount (fee schedule, reasonable charges, or
    reasonable cost) for covered services in excess of the annual $100
    deductible. Covered services include doctors' services, lab and
    other diagnostic tests, X-ray and other radiation therapy,
    outpatient services, therapy, ambulance services, home health
    services, and provision of durable medical equipment. Page 61
    GAO/HEHS-99-101 Severely Disabled Adults Appendix III Other
    Federal Programs With Disability as a Criterion for Eligibility
    Income Security Budget Subfunction          Social Insurance for
    Railroad Workers.42 Provides monthly Social 601-General Retirement
    Security benefits, rail industry pensions, permanent and
    occupational and Disability Insurance    disability benefits,
    federal windfall benefits, supplemental annuities, and (Excluding
    Social           sickness and unemployment benefits to workers and
    their families. Security)                   Longshore and Harbor
    Workers' Compensation. Provides compensation for disability or
    death resulting from injury, including occupational disease, to
    longshore workers, harbor workers, and certain other eligible
    employees engaged in maritime employment on the navigable waters
    of the United States and adjoining pier and dock areas. Coal Mine
    Workers' Compensation. Provides monthly cash benefits to coal
    miners who are totally disabled from coal workers' pneumoconiosis
    (black lung disease) and to widows and other surviving dependents
    of miners who have died of this disease. Special Benefits for
    Disabled Coal Miners. Provides monthly cash benefits to coal
    miners who have become totally disabled by coal workers'
    pneumoconiosis or other chronic lung diseases arising from coal
    miner employment and to widows and other surviving dependents of
    miners who have died of these diseases. Budget Subfunction
    Supportive Housing Program. Provides project grants designed to
    604-Housing Assistance      promote the development of supportive
    housing and services to help people make the transition from
    homelessness to living as independently as possible. Program funds
    may be used in part to provide for transitional housing for up to
    24 months and permanent housing in conjunction with appropriate
    supportive services to maximize the ability of people with
    disabilities to live as independently as possible. Economic
    Development and Supportive Services Program. Provides project
    grants to enable public housing agencies and Indian tribes in
    partnership with nonprofit or for-profit agencies to (1)
    facilitate economic development opportunities and supportive
    services to assist residents to become economically self-
    sufficient and (2) assist the elderly and people 42This federal
    program was also classified under budget subfunction 603 for
    unemployment compensation. Page 62
    GAO/HEHS-99-101 Severely Disabled Adults Appendix III Other
    Federal Programs With Disability as a Criterion for Eligibility
    with disabilities to live independently and prevent premature or
    unnecessary institutionalization. Operating Assistance for
    Troubled Multifamily Housing Projects. Provides loans to the
    elderly and people with disabilities to restore or maintain the
    physical and financial soundness of eligible housing projects, as
    well as to assist in the management and maintenance of the low- to
    moderate-income character of certain projects approved for
    assistance under the National Housing Act or the Housing and Urban
    Development Act of 1965. Rural Rental Assistance Payments.
    Provides rental assistance to reduce the rents paid by low-income
    senior citizens or families, domestic farm laborers, and citizens
    with disabilities occupying eligible rural rental housing whose
    rents exceed 30 percent of an adjusted monthly income and whose
    income does not exceed the limit established for the state. Rural
    Rental Housing Section 538 Guaranteed Loans. Provides guaranteed
    loans to encourage the construction of new rural, multifamily
    rental housing and appropriate related facilities, generally
    consisting of two or more family units. Occupants must have low to
    moderate incomes, be elderly, or have disabilities. Income cannot
    exceed 115 percent of the median income. Guaranteed loans may not
    be made for nursing, special care, or industrial-type housing.
    Public and Indian Housing. Provides funding to authorized local
    public housing agencies for the operation of cost-effective,
    decent, safe, and affordable dwellings for lower-income families,
    the elderly, and families with people with disabilities. Budget
    Subfunction        Food Stamps. Provides low-income households the
    ability to improve 605-Food and Nutrition    their diets by
    increasing their food purchasing ability. Food stamp benefits
    Assistance                vary on the basis of family size,
    income, and level of resources. Food stamps may be used in
    participating retail stores to buy food for home consumption; by
    certain elderly people and people with disabilities and their
    spouses who cannot prepare their own meals and receive meals
    delivered to them by authorized meal delivery services; and by
    people who are elderly, disabled, or both and their spouses to
    purchase meals in establishments providing communal dining for the
    elderly. Page 63                                        GAO/HEHS-
    99-101 Severely Disabled Adults Appendix III Other Federal
    Programs With Disability as a Criterion for Eligibility Nutrition
    Program for the Elderly (Commodities). Provides food for use in
    the preparation of congregate or home-delivered meals by nutrition
    programs for the elderly. This program is designed to improve the
    diets of the elderly and to increase the market for domestically
    produced foods acquired under surplus removal or price support
    operations. Meals may be served in a congregate setting or
    delivered to the home to eligible individuals aged 60 and over
    and, in certain cases, under age 60 if the individual is
    handicapped or disabled and resides with and accompanies an older
    individual. Child and Adult Care Food Program. Assists states,
    through grants-in-aid and other means, to initiate and maintain
    nonprofit food services programs for children, the elderly, and
    adults with impairments in nonresidential day care facilities. The
    program is generally limited to children 12 years old and younger,
    individuals with disabilities, functionally impaired adults at
    least 18 years old, and adults 60 years of age and older. Meals
    must meet minimum requirements of the U.S. Department of
    Agriculture. Budget Subfunction     Family Support Payments to
    States. Provides cash payments directly 609-Other Income       to
    eligible needy families with dependent children through the
    Temporary Security               Assistance for Needy Families
    program and to needy people who are aged, blind, or disabled in
    Guam, Puerto Rico, and the Virgin Islands. The program also
    provides child care, so that individuals can participate in
    approved education and training activities and accept or maintain
    employment, and temporary emergency assistance to families with
    children. Social Security Budget Subfunction     Social Security
    Retirement Insurance. Provides monthly cash benefits 651-Social
    Security    to eligible retired workers and their eligible family
    members to replace part of the earnings lost as a result of
    retirement. Retired workers aged 62 and over who have worked the
    required number of years under Social Security are eligible for
    monthly benefits. Also, certain family members can receive
    benefits, including (1) a wife or husband aged 62 or older; (2) a
    spouse at any age, if a child who is under age 16 or is disabled
    is in his or her care and is entitled to benefits on the basis of
    the worker's record; Page 64
    GAO/HEHS-99-101 Severely Disabled Adults Appendix III Other
    Federal Programs With Disability as a Criterion for Eligibility
    (3) unmarried children under age 18; (4) unmarried adult offspring
    at any age if disabled before age 22; and (5) divorced wives or
    husbands aged 62 or older who were married to the worker for at
    least 10 years. Veterans' Benefits and Services Budget Subfunction
    All-Volunteer Force Educational Assistance. Provides educational
    702-Veterans Education,    assistance to those who have served on
    active duty after June 30, 1985. Training, and              This
    program also assists in the recruitment and retention of highly
    Rehabilitation             qualified personnel in the active and
    reserve armed forces by extending the benefits of higher education
    to those who may not otherwise be able to afford it. Physical or
    mental disability that is not the result of the individual's own
    willful misconduct can extend the 10 years after release from
    service that veterans have to complete their education. Veterans
    must serve 2 years before they are eligible for basic educational
    assistance. Participants who have not completed the required
    obligated service must have been discharged for a service-
    connected disability. Post-Vietnam-Era Veterans' Educational
    Assistance. Provides educational assistance to people entering the
    armed forces after December 31, 1976, and before July 1, 1985, to
    help them obtain an education they might otherwise not be able to
    afford. This program was also designed to promote and assist the
    all-volunteer military program of the United States by attracting
    qualified people to serve in the armed forces. Post-Vietnam-era
    veterans must have served honorably on active duty for more than
    180 continuous days beginning on or after January 1, 1977, or have
    been discharged after that date because of a service-connected
    disability. Survivors and Dependents Educational Assistance.
    Provides partial support to the following individuals who are
    seeking to advance their education: qualifying spouses, surviving
    spouses, or children between ages 18 and 26 of (1) deceased
    veterans or veterans who, as a result of their military service,
    have a permanent and total (100-percent) service-connected
    disability or (2) service personnel who have been listed for a
    total of more than 90 days as currently missing in action or as
    prisoners of war. Assistance in the form of monthly payments for
    up to 45 months to be used for tuition, books, subsistence, and so
    on is available Page 65
    GAO/HEHS-99-101 Severely Disabled Adults Appendix III Other
    Federal Programs With Disability as a Criterion for Eligibility
    for 10 years from the date of the veteran's disability rating or
    the date of death of a veteran classified with a total service-
    connected disability. Budget Subfunction          Veterans Medical
    Care Benefits. Provides hospital outpatient medical 703-Hospital
    and Medical    and dental services, medicines, and medical
    supplies to enrolled veterans Care for Veterans           in a VA
    medical care facility. Eligible veterans include, among others,
    those that require treatment for a service-connected disability,
    have a service-connected disability rated at 50 percent or more,
    have a compensable service-connected disability rated at less than
    50 percent, or are former prisoners of war. Budget Subfunction
    Veterans Housing Guaranteed and Insured Loans. Provides 704-
    Veterans Housing        VA-guaranteed or -insured loans to assist
    eligible veterans, certain service personnel, and certain
    surviving spouses of veterans who have not remarried in obtaining
    credit to purchase, construct, or improve homes on more liberal
    terms than are generally available to nonveterans. Eligible
    veterans include those with a service-connected disability.
    Veterans Housing Manufactured Home Loans. Provides VA-guaranteed
    or -insured loans to assist eligible veterans, certain service
    personnel, and certain surviving spouses of veterans who have not
    remarried in obtaining credit to purchase a manufactured home on
    more liberal terms than are generally available to nonveterans.
    Eligible veterans include those with a service-connected
    disability. Native American Veteran Direct Loan Program. Provides
    direct loans to certain Native American veterans, certain service
    personnel, and certain surviving spouses of Native American
    veterans who have not remarried to purchase or construct homes on
    trust lands. Eligible veterans include those with a service-
    connected disability. Administration of Justice Budget Subfunction
    Public Safety Officers' Benefits Program. Provides a $141,556
    death 754-Criminal Justice        benefit to the eligible
    survivors of a federal, state, or local public safety Assistance
    officer whose death is the direct and proximate result of a
    personal Page 66                                        GAO/HEHS-
    99-101 Severely Disabled Adults Appendix III Other Federal
    Programs With Disability as a Criterion for Eligibility
    (traumatic) injury sustained in the line of duty. The program also
    provides a $141,556 disability benefit to a federal, state, or
    local public safety officer whose permanent and total disability
    is the direct and proximate result of a personal injury sustained
    in the line of duty. General Government Budget Subfunction
    Federal Employment Assistance for Veterans. Provides assistance to
    805-Central Personnel    veterans in obtaining federal employment.
    A 5-point preference is given to Management               veterans
    separated under honorable conditions who served on active duty in
    the armed forces of the United States during certain periods of
    time or who have a campaign or expeditionary medal. A 10-point
    preference is given to disabled veterans and certain wives or
    husbands, widows or widowers, and mothers of veterans. Retired
    members of the armed forces have not been considered eligible for
    preference since October 1, 1980, unless they are veterans with
    disabilities or they retired below the rank of major or the
    equivalent. Budget Subfunction       Weatherization Assistance for
    Low-Income Persons. Provides 999-Miscellaneous        formula
    grants to states to improve the thermal efficiency of dwellings of
    low-income people, particularly individuals who are elderly or
    handicapped, by the installation of weatherization materials, such
    as attic insulation, caulking, weatherstripping, and storm
    windows, and by furnace efficiency modification in order to
    conserve needed energy and to aid those people least able to
    afford higher utility costs. Page 67
    GAO/HEHS-99-101 Severely Disabled Adults Appendix IV Medicaid
    Expenditures for Personal Care and Related Services Medicaid's
    provision of personal care and in-home services has evolved
    considerably over the years, particularly as the use of HCBS
    waivers as a means of providing community-based services has
    grown. For fiscal year 1998, expenditures for Medicaid community-
    based services-home health, the PCS benefit, and HCBS waivers-
    totaled $14.8 billion. From 1987 to 1998, expenditures grew at an
    average annual rate of 16 percent for Medicaid home health, 10
    percent for the PCS benefit, and 31 percent for the HCBS waivers
    (see fig. IV.1). HCBS waivers account for about 62 percent of all
    community-based expenditures under Medicaid, compared with 15
    percent for home health and 23 percent for the PCS benefit. Table
    IV.1 shows each state's total Medicaid spending for community-
    based care and expresses the proportion of total spending for each
    of the three benefits. Figure IV.1: Growth in Medicaid
    Expenditures for Personal Care and    10 Expenditures (Billions)
    Related Services, 1987-98 9 8 7 6 5 4 3 2 1 0 1987      1988
    1989    1990    1991    1992     1993    1994    1995    1996
    1997    1998 HCBS Waivers Home Health PCS Benefit Source: HCFA.
    Page 68                                                  GAO/HEHS-
    99-101 Severely Disabled Adults Appendix IV Medicaid Expenditures
    for Personal Care and Related Services Table IV.1: Medicaid
    Community-Based Expenditures,
    Percentage of total expenditures Fiscal year 1998 Fiscal Year 1998
    expenditures                           HCBS State
    (millions) PCS benefit             waivers Home health Alabama
    $141                   a        83.72          16.28 Alaska
    35          12.11         84.59           3.30 Arizonab
    1           19.98              a         80.02 Arkansas
    128          49.36         35.04          15.60 California
    549          59.10         25.86          15.04 Colorado
    266               a        80.52          19.48 Connecticut
    410               a        72.73          27.27 Delaware
    38               a        80.72          19.28 District of
    Columbia                        13           2.73              a
    97.27 Florida                                    370
    3.82c        67.74          28.44 Georgia
    180               a        75.41          24.59 Hawaii
    27               a        93.61           6.39 Idaho
    36          42.46         45.09          12.45 Illinois
    291               a        95.53           4.47 Indiana
    97               a        53.65          46.35 Iowa
    119               a        63.16          36.84 Kansas
    219           3.74         90.29           5.97 Kentucky
    183               a        46.94          53.06 Louisiana
    89               a        75.18          24.82 Maine
    117           3.06         84.86          12.07 Maryland
    232          10.39         67.10          22.51 Massachusetts
    631          22.05         63.43          14.52 Michigan
    520          39.95         54.35           5.69 Minnesota
    533          18.49         71.94           9.56 Mississippi
    23               a        46.35          53.65 Missouri
    318          28.84         68.71           2.45 Montana
    41          32.41         64.03           3.56 Nebraska
    97           5.58         78.43          15.99 Nevada
    21           9.53         55.86          34.61 New Hampshire
    109           2.10         94.36           3.54 New Jersey
    506          33.51         49.37          17.12 New Mexico
    117               a        96.58           3.42 New York
    3,950             41.90         36.85          21.24 North
    Carolina                             482          28.20
    57.57          14.23 North Dakota
    39               a        95.53           4.47 Ohio
    321               a        86.25          13.75 (continued) Page
    69                                           GAO/HEHS-99-101
    Severely Disabled Adults Appendix IV Medicaid Expenditures for
    Personal Care and Related Services Percentage of total
    expenditures Fiscal year 1998 expenditures
    HCBS State                                   (millions) PCS
    benefit              waivers Home health Oklahoma
    161              15.03         84.20              0.77 Oregon
    295               6.77         93.09              0.14
    Pennsylvania                                   590
    a,c      90.57              9.43 Rhode Island
    150                   a        97.05              2.95 South
    Carolina                                 145               0.81c
    88.34            10.85 South Dakota
    47              1.55         92.18              6.27 Tennessee
    87                  a        99.52              0.48 Texas
    648              35.33         64.67                    a Utah
    66              0.66         95.42              3.93 Vermont
    71              2.15c        92.04              5.81 Virginia
    205                   a        96.00              4.00 Washington
    432              27.79         69.56              2.66 West
    Virginia                                  150              18.56
    67.10            14.34 Wisconsin
    435              15.08         72.70            12.21 Wyoming
    48                  a        91.11              8.89 Total
    $14,780               23.47         61.52            15.01 aState
    did not report expenditures in this benefit category. bArizona
    offers personal care services through a section 1115 waiver
    demonstration program; HCFA assigned expenditures from this waiver
    to the PCS benefit. cState does not offer the PCS benefit to
    adults; expenditures under this benefit represent personal care
    services provided to children under the Early Periodic Screening,
    Diagnostic, and Treatment program. Source: HCFA. Page 70
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers Under Medicaid,
    states have three approaches for providing personal care, two of
    which may be offered at the discretion of the state. First, states
    must offer the Medicaid home health services benefit (including
    home health aides), which may provide unskilled personal care
    services. Second, states may choose to provide the PCS benefit,
    which offers unskilled personal care services as a part of the
    states' Medicaid benefit package. Third, HCBS waivers give states
    the option of providing personal care and other related services
    if they choose to do so. All candidates for personal care and
    other long-term care services are given individualized
    assessments, frequently coupled with environmental evaluations
    that take into account the candidates' informal and community
    support. The objective is to ensure that (1) services are focused
    primarily on those with the greatest need, (2) personal care is
    targeted to prevent institutionalization as a first priority, and
    (3) only those with no feasible alternative are admitted to
    nursing homes. How states approach assessments can vary, primarily
    in the degree of professional discretion afforded to the assessor.
    Thus, some states use an assessment instrument that produces a
    numeric score, which essentially determines the level of care that
    the state will provide. Other states rely exclusively on the
    professional judgment of the individual assigned to undertake the
    assessment. States impose different limits on these services that
    are somewhat dependent on the states' use of home health, the PCS
    benefit, or HCBS waivers. Under home health and the PCS benefit,
    states may limit services through medical necessity or utilization
    controls. HCBS waivers provide a much wider array of means to
    limit services that includes targeting populations, limiting
    geographic availability (statewideness), and capping expenditures.
    In all cases, imposing limits on services can help states to
    control costs. Home Health    States must offer home health
    services as a part of their Medicaid program to all beneficiaries
    who are entitled to nursing facility services. Under Medicaid, a
    physician must order home health services as part of a care plan
    that is reviewed periodically and includes part-time or
    intermittent nursing services; home health aide services; and
    medical supplies, equipment, and appliances suitable for use in
    the home. Home health aide services must be provided by a home
    health agency and can include the provision of personal care.
    States may also choose to provide physical, occupational, and
    speech pathology and audiology as optional services. Page 71
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers States can elect to
    limit the number of visits, the number of hours, or the dollar
    amount of certain services provided under the Medicaid home health
    program. Table V.1 shows the states' major limitations. Sixteen
    states specify no limitations, and most states allow established
    limits to be exceeded with prior authorization. Table V.1: Limits
    Imposed Under the Medicaid Home Health Benefit           State
    Limits Alabama                      104 visits per recipient per
    calendar year Alaska                       a Arizona
    a Arkansas                     50 visits for any combination of
    home health nurse or aide services without prior authorization
    California                   More than one visit in 6 months is
    subject to prior authorization and to a physician-approved
    treatment plan requirement. A maximum total of 30 visits may be
    approved at any one time, valid for a period not exceeding 120
    days. Colorado                     Covered visit is 2-1/2 hours.
    No more than five home health visits are covered per day.
    Simultaneous visits by two or more individuals count as one visit.
    Connecticut                  Prior authorization is required after
    the first two visits for intermittent nursing services when no
    home health agency exists in the area; for home health aide
    services in excess of 20 hours per week; and for physical,
    occupational, speech pathology, and audiology services. Delaware
    a District of Columbia         36 visits per year unless prior
    authorization is obtained; services of a home health aide are
    limited to 4 hours per day except by prior authorization. Florida
    60 home health visits per year; 4 visits per day by a registered
    nurse; or 1 visit per day by a licensed practical nurse except by
    prior authorization Georgia                      75 nursing or
    home health visits per recipient per calendar year Hawaii
    One visit per day during the first 2 weeks; three visits during
    the next 5 weeks; one visit per week for the following 7 weeks,
    and one visit every 60 days thereafter; additional services
    require prior authorization. Idaho                        100 per
    recipient per calendar year; prior authorization is required for
    all medical equipment that costs more than $100 purchased by the
    department. Illinois                     Prior authorization is
    required except when services are provided by independently
    practicing physical, occupational, or speech therapists or by
    community health agencies. Indiana                      30
    hours/sessions/visits in a 30-day period unless prior
    authorization is obtained (continued) Page 72
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers State
    Limits Iowa                         a Kansas
    Home health aide services are limited to one visit per day, and
    physical, occupational, speech therapy, and restorative aide
    services are limited to 6 months from the first date of service.
    Kentucky                     Prior authorization is required for
    durable medical equipment that costs $150 or more. Louisiana
    50 nursing and home health aide visits and 50 physical therapy
    services per year, except for recipients of Early and Periodic
    Screening, Diagnostic and Treatment program services Maine
    a Maryland                     One visit of less than 4 hours per
    type of service per day, eight visits per month for physical or
    speech pathology, four visits per month for occupational therapy,
    and 12 home health aide services per month; services and medical
    supplies that cost more than $900 per month require prior
    authorization. Massachusetts                Prior authorization is
    required for home health aide services exceeding 120 hours in a
    calendar month when services exceeded 120 hours in each of the 2
    preceding months. Michigan                     a Minnesota
    Prior authorization is required, unless a professional nurse
    determines an immediate need, for up to 40 visits per calendar
    year and for certain medical supplies and equipment. Mississippi
    Patients are limited to a combined total of 50 visits per fiscal
    year, medical equipment that costs less than $150 must be
    purchased, and a determination must be made whether to rent or
    purchase equipment that costs more than $150. Missouri
    100 visits per patient per year Montana                      100
    home health visits and 75 skilled nursing visits per recipient per
    fiscal year; home health aide services are not provided for an
    individual receiving personal care services. Nebraska
    40 hours per week and 8 hours per day Nevada
    a New Hampshire                Prior authorization is required to
    purchase durable medical equipment exceeding certain cost limits
    as well as portable and in-home oxygen equipment. New Jersey
    Personal care assistant services are limited to 25 hours per week.
    New Mexico                   a New York                     a
    North Carolina               Prior authorization is required for
    durable medical equipment. North Dakota                 a Ohio
    a (continued) Page 73
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers State
    Limits Oklahoma                        12 home health visits per
    year Oregon                          a Pennsylvania
    15 visits per month after 28 days of unlimited visits, one fee per
    visit regardless of services provided, and 1 visit per month for
    prenatal care Rhode Island                    Prior authorization
    is required for more than eight visits per month and for all
    medical supplies, equipment, and appliances. South Carolina
    75 home health agency visits per fiscal year South Dakota
    a Tennessee                       a Texas
    50 nurse and home health aide visits per recipient per year
    without prior authorization Utah
    Housekeeping or homemaking services and occupational therapy are
    not covered. Vermont                         Routine services are
    covered for 4 months with a physician's certification. Virginia
    32 home health agency or registered nurse visits or home health
    aide services and 24 rehabilitative therapy services ordered
    annually without prior authorization Washington
    Approval is required when the home health service duration or
    monthly payment will exceed the program's limits. West Virginia
    a Wisconsin                       30 visits by a registered aide,
    registered nurse, licensed practical nurse, or therapist without
    prior authorization; home health aide visits requiring more than 4
    hours of continuous care require prior authorization. Wyoming
    a aNo limitation specified. Source: Medicare and Medicaid Guide,
    Commerce Clearing House, Inc. PCS Benefit    Twenty-seven states
    and the District of Columbia offer personal care under the PCS
    benefit, which is an optional benefit under the Medicaid program.
    Nine states43 provide personal care services to only the
    categorically needy, which include low-income children; pregnant
    women; aged, blind, or disabled people meeting Supplemental
    Security Income program requirements; and individuals who are
    eligible to receive 43For three of these states (Arkansas,
    Oklahoma, and Washington), limiting personal care services to the
    categorically needy is a departure from policies on other benefits
    in their Medicaid programs, which are offered to both
    categorically needy and medically needy individuals. Page 74
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers federally assisted
    income maintenance payments. Such individuals must generally meet
    income and resource standards established for public assistance.
    The remaining 18 states and the District of Columbia provide
    personal care to both categorically needy and medically needy
    individuals. The latter group comprises those individuals whose
    income, resources, or both exceed the levels for the categorically
    needy, but who cannot afford to pay their medical bills. To
    control utilization of personal care services, states usually
    require prior authorization, establish concrete limits on the
    duration of services, or both. Table V.2 lists the control
    techniques used by each state. A few states have targeted
    eligibility for the PCS benefit by identifying a population or
    functional impairment for which they will provide assistance. For
    example, New Hampshire limits eligibility to individuals with
    chronic disabilities who use a wheelchair, and Florida limits
    personal care to children with disabilities. Table V.2: Limits
    Imposed Under the Medicaid PCS Benefit                   State
    Limits Alaskaa                      One assessment and treatment
    plan per 12 months Arizonaa                     b Arkansasc
    Services cannot exceed 72 hours per month without prior approval.
    California                   Services must not exceed 283 hours
    per month. District of Columbia         Services cannot exceed 4
    hours per day or 1,040 hours in 12 months without prior
    authorization. Idahoa                       16 hours per week
    Kansas                       Prior authorization is required for
    up to 24 hours per day. Maine                        Available to
    individuals with chronic or permanent disabilities who are able to
    self-direct a personal care attendant Maryland
    Services are provided at one of four intensity levels of care
    subject to prior authorization. Massachusetts                Prior
    authorization is required. Michigan                     b
    Minnesota                    Prior authorization is required.
    Missouria                    Need assessment to be completed every
    6 months Montana                      40 hours per week unless
    prior authorization is obtained Nebraska                     40
    hours per week unless prior authorization is obtained Nevadaa
    Prior authorization is required. New Hampshire
    Recipients must be chronically wheelchair-bound. New Jersey
    25 hours per week or up to 40 hours per week with prior
    authorization New York                     6 months for one of
    three levels of services with prior authorization unless
    exceptions are authorized for up to 12 months (continued) Page 75
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers State
    Limits North Carolina                  80 hours per month and
    covered only if no home health aide services are provided on the
    same day Oklahomac                       Departmental approval is
    required. Oregon                          Prior authorization is
    required. South Dakotaa                   120 hours per calendar
    quarter Texas                           Lesser of 50 hours per
    week or the rate of the average nursing facility; prior
    authorization is required and a plan of treatment must be
    reviewed. Utah                            60 hours per month and
    covered only if no home health aide services are provided on the
    same day Washingtonc                     b West Virginia
    Limited on a per-unit, per-month basis; prior authorization is
    required for additional hours of care. Wisconsin
    Prior authorization is required for more than 250 hours per
    calendar year; housekeeping tasks are limited to one-third of the
    time spent in the recipient's home. aProvide personal care
    services to only the categorically needy. bNo limitation
    specified. cProvide most Medicaid services to both categorically
    needy and medically needy, but limit personal care services to
    categorically needy. Source: Medicare and Medicaid Guide, Commerce
    Clearing House, Inc. HCBS Waivers    Forty-three states and the
    District of Columbia provide personal care under an HCBS waiver;
    24 states and the District of Columbia offer both the Medicaid PCS
    benefit and one or more HCBS waivers. While HCBS waivers offer
    broader opportunities to limit or target services, the
    availability of national data on them is limited. The APHSA
    database of HCBS waivers, however, does track waivers by target
    populations and number of clients served (see table V.3). Page 76
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers Table V.3: Clients
    Served by Medicaid HCBS Waivers With Personal Care,
    Waivers' target populationsa
    Number of clients 1997                                     Alabama
    Mentally retarded or developmentally disabled people
    3,290 Aged and disabled people
    6,316 Disabled people
    362 Arkansas Disabled adults who are 21 to 64
    60 California Mentally retarded or developmentally disabled people
    who are technology-dependent
    35,105 Aged and disabled people
    8,314 People with HIV/AIDSb
    2,792 Colorado Aged and disabled people
    5,843 People with HIV/AIDS
    101 Chronically mentally ill people who are over 18
    79 People with traumatic brain injury
    70 Developmentally disabled people who are 18 and older
    c Connecticut Disabled people who are 18 to 64 and need help with
    2+ ADLs                               c People with traumatic
    brain injury who are 18 to 64
    c Delaware People with HIV/AIDS-related conditions
    174 District of Columbia Mentally retarded or developmentally
    disabled people who are 22 and older
    75 People who are 65 and older
    c Florida Aged and disabled people who are 18 and older
    16,943 Mentally retarded or developmentally disabled people
    10,302 Aged and disabled people who are 18 and older
    1,380 People with AIDS
    8,000 Mentally retarded or developmentally disabled people who are
    over 18
    116 Elderly people
    c Georgia Aged and disabled people
    16,500 Mentally retarded or developmentally disabled people
    2,109 Disabled adults who are 24 to 64d
    121 (continued) Page 77
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers Waivers' target
    populationsa                                             Number of
    clients Hawaii Mentally retarded or developmentally disabled
    people                                   512 Aged and disabled
    people
    338 People with AIDS/ARCe
    104 Iowa People with HIV/AIDS
    29 Mentally retarded people (including children)
    4,530 People with traumatic brain injury who are 30 to 64
    30 Mentally retarded or developmentally disabled people and
    mentally retarded children with disabilities
    374 Elderly people
    2,236 Idaho Aged and disabled people 21 and older
    1,429 Mentally retarded or developmentally disabled people 21 and
    older
    415 Illinois Disabled people
    12,021 People with HIV/ARC/AIDS
    984 Mentally retarded or developmentally disabled adults
    5,224 People who have been disabled by an acquired traumatic brain
    injury
    c Indiana Aged and disabled people
    2,467 Mentally retarded people and those with related conditions
    1,201 Kansas Aged and disabled people
    3,150 Physically disabled people who are 16 to 64
    1,880 People with traumatic brain injuryd
    160 Kentucky Aged and disabled people
    11,500 Adults and children with traumatic brain injury
    c Louisiana Mentally retarded or developmentally disabled people
    2,095 People with loss of sensory motor function
    103 Aged and disabled people
    222 Maryland Mentally retarded or developmentally disabled people
    3,600 Maine Elderly people
    554 (continued) Page 78
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers Waivers' target
    populationsa                                         Number of
    clients Physically disabled people
    204 Disabled people who are 18 to 60
    13 People with traumatic brain injury
    c Michigan Aged and elderly people
    2,804 Minnesota Elderly people
    6,582 Mentally retarded people and those with related conditions
    5,657 Disabled people under 65
    2,751 People with acquired traumatic brain injury
    290 Missouri Mentally retarded or developmentally disabled people
    5,860 People with HIV/AIDS
    140 Disabled people and developmentally disabled people who are 21
    to 64d
    c Mississippi Disabled people who are 21 to 64
    100 Mentally retarded or developmentally disabled people
    325 Montana Aged and disabled people
    1,158 Mentally retarded or developmentally disabled people
    652 North Carolina Mentally retarded or developmentally disabled
    people                             3,201 North Dakota Mentally
    retarded or developmentally disabled people
    1,792 Aged and disabled people
    366 People with traumatic brain injury who are 18 to 64
    9 New Hampshire Mentally retarded or developmentally disabled
    people                             1,303 People with acquired
    traumatic brain injury who are 22 and olderd
    27 New Jersey Mentally retarded or developmentally disabled people
    5,242 People 18 to 65 who incurred traumatic brain injury after
    age 16d
    153 New Mexico People with AIDS/ARC
    60 Aged and disabled people
    1,200 Mentally retarded or developmentally disabled people
    1,500 (continued) Page 79
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers Waivers' target
    populationsa                                          Number of
    clients Nevada Frail elderly people 65 and older
    898 Elderly people in group care
    72 Ohio Aged and disabled people
    17,000 Aged and disabled people under 60
    3,904 Mentally retarded or developmentally disabled people
    2,512 Mentally retarded or developmentally disabled people 18 and
    over
    c Oregon Aged and disabled people
    19,471 Pennsylvania Physically disabled people
    c Elderly people
    675 Rhode Island Elderly people 65 and over
    600 Physically disabled peopled
    80 South Carolina Aged and disabled people
    7,658 People with HIV/AIDS
    637 Mentally retarded people and those with related conditions
    2,288 People with traumatic brain injury and spinal cord injury
    161 Adults who are technology-dependent (ventilator-dependent)d
    27 South Dakota People 18 and over who are quadriplegic
    39 Tennessee Aged and disabled people
    306 Mentally retarded or developmentally disabled people
    2,200 Aged and disabled people
    150 Texas Aged and disabled people
    9,945 Aged and disabled people 21 and older
    c Utah Physically disabled people
    c Virginia Aged and disabled people
    7,442 Mentally retarded and developmentally disabled people
    1,685 Aged and disabled people 18 and over
    c People with HIV/AIDS who are symptomatic
    636 (continued) Page 80
    GAO/HEHS-99-101 Severely Disabled Adults Appendix V States' Use of
    Home Health, the PCS Benefit, and HCBS Waivers Waivers' target
    populationsa
    Number of clients Chronically ill children with traumatic brain
    injury and adults with traumatic brain injuryd
    178 Vermont Mentally retarded people and those with related
    conditions                                   1,419 Aged and
    disabled people
    780 Washington Aged and disabled people
    17,013 Mentally retarded or developmentally disabled people
    c Developmentally disabled people who are inappropriately placed
    c People with HIV/AIDS
    69 People with traumatic brain injuryd
    16 Wisconsin Aged and disabled people
    10,670 People who are developmentally disabled
    6,936 Mentally retarded and developmentally disabled people
    90 Wyoming Developmentally disabled people
    611 Aged and disabled people
    700 Total 118 waivers
    331,467 aOnly HCBS waivers offering personal care or attendant
    care to adults were included in our state analysis of HCFA waivers
    and auxiliary services. bHuman immunodeficiency virus/acquired
    immunodeficiency syndrome. cData not reported in the APHSA Summary
    of 1915 (c) HCBS waivers. dHCBS waivers considered Model Waivers
    under the Medicaid program. eAIDS-related complex. Source: APHSA.
    Page 81                                             GAO/HEHS-99-
    101 Severely Disabled Adults Appendix VI Cash and Counseling
    Demonstration and Evaluation The Cash and Counseling Demonstration
    and Evaluation (CCDE) project represents one of the first
    systematic evaluations of consumer-directed personal care.
    Sponsored by the Robert Wood Johnson Foundation, in cooperation
    with the Department of Health and Human Services, Office of the
    Assistant Secretary for Planning and Evaluation, the CCDE is
    expected to evaluate the advantages and disadvantages of offering
    consumers the choice of receiving personal care services under
    Medicaid via a direct cash allowance in lieu of state payments to
    service providers. The University of Maryland Center on Aging is
    directing and coordinating the demonstration, overseeing the
    evaluation, and providing technical assistance to the
    demonstration states-Arkansas, Florida, New Jersey, and New York.
    Uniform           The CCDE has established a rigorous experimental
    protocol. The research Requirements      questions seek to
    identify whether there are significant differences between
    interested consumers who are randomly assigned to receive cash
    allowances and those with agency-delivered services in the
    following areas: * types and amounts of services, * program and
    administrative costs, and * consumer satisfaction and quality of
    care. Additionally, the CCDE plans to identify the counseling
    services offered to consumers with cash payments to determine
    which consumers take advantage of additional supports, such as
    instruction in how to train providers and manage payroll.
    Consumers will also be asked to assess the value of the counseling
    services they receive under the CCDE. The evaluation will also
    examine the effects of the demonstration on informal caregivers
    and paid workers. The four states participating in the CCDE have
    agreed to take part in a rigorous evaluation process and to enroll
    at least 3,500 individuals in their programs. The manner in which
    individuals enter each state's program will be the same as the
    current process: individuals will continue to receive an
    assessment (or reassessment) that takes into account existing
    formal and informal supports, such as care regularly provided by
    family members. Any unmet needs for personal assistance will be
    identified and will become the basis for a care plan. Once deemed
    eligible for the program, individuals will be randomly assigned to
    either a control group or a Page 82
    GAO/HEHS-99-101 Severely Disabled Adults Appendix VI Cash and
    Counseling Demonstration and Evaluation treatment group (cash
    option).44 In the control group, the consumer will receive
    services as traditionally provided in each state's Medicaid
    program. Those assigned to the cash option group will "cash out"
    their benefits as defined by their care plans-in effect, the cost
    of their service needs will be converted to a cash payment that
    they will be able to use to purchase services directly. Consumers
    in the cash option group will then pay caregivers directly or will
    choose to have a fiscal intermediary perform the payroll
    function.45 Consumers will not be required to spend all the money
    on personal attendants and will be able to save some of it for
    emergencies or costly items, such as environmental modifications
    or assistive devices. Additionally, the demonstration will waive
    Medicaid rules that prohibit the hiring of legally responsible
    relatives, allowing family members to become paid caregivers.
    Counseling services, which are an integral part of the CCDE, will
    be offered to meet an array of needs. For example, counseling
    services will help consumers decide whether to use a fiscal
    intermediary or obtain training and counseling on how to be an
    employer. Earlier on, the Robert Wood Johnson Foundation
    contracted with Health Services Research Institute, which prepared
    an employer and taxation booklet tailored to the four states.
    Additional counseling services may include assisting consumers
    with screening providers, finding emergency or substitute
    arrangements, managing tax forms and insurance paperwork, and even
    locating home modification subcontractors. Variations in
    There is variation in how the four CCDE states plan to implement
    this Implementing the    demonstration, including their (1)
    approach to personal care under Medicaid, (2) use of a fiscal
    intermediary and counseling services, and CCDE                (3)
    outreach and enrollment efforts. Arkansas, New Jersey, and New
    York are implementing the CCDE through their PCS benefit, for
    which each state has slightly different service limits 44Consumers
    interested in directing all aspects of their care-including cash
    management-must first pass a skills test. In the event a consumer
    is not totally capable of self-direction, he or she has the
    opportunity to select a representative decisionmaker to act on the
    consumer's behalf. 45While several models exist, a fiscal
    intermediary generally manages any legal requirements associated
    with the employment of the caregiver, often through payroll
    management and tax filings. For a description of other
    intermediary models, see Flanagan and Green, Consumer-Directed
    Personal Assistance Services: Key Operational Issues for State CD-
    PAS Programs Using Intermediary Service Organizations, Final
    report for the Department of Health and Human Services by The
    MEDSTAT Group (Washington, D.C.: Oct. 24, 1997). Page 83
    GAO/HEHS-99-101 Severely Disabled Adults Appendix VI Cash and
    Counseling Demonstration and Evaluation and authorization
    requirements. Florida's personal care will be provided through
    HCBS waivers, including one that targets elderly individuals and
    those with physical disabilities and another that includes
    children and adults with developmental disabilities. Both waiver
    populations will participate in the CCDE evaluation. The other
    three states will include a mix of older and younger adults with
    physical disabilities. The four CCDE states also differ in the way
    they plan to implement fiscal intermediary and counseling
    services. Arkansas divided the state into four regions and asked
    each to select an entity that would provide both counseling and
    fiscal intermediary services. The regional selections varied and
    included an area Office on Aging, a rehabilitation center, and a
    center for developmental disabilities. New York, which will be the
    last state to implement the CCDE, also plans to combine counseling
    and fiscal intermediary services. Florida and New Jersey have
    selected one organization to serve as the fiscal intermediary on a
    statewide basis and separate entities to provide their counseling
    services. Outreach and enrollment efforts by states reflect the
    concern that all consumers have the opportunity to select a cash
    option.46 In New Jersey and Arkansas, the same organizations that
    provide personal care services under the CCDE also enroll
    individuals for the traditional personal care benefit. Because
    these organizations have a vested interest in provider-based care,
    states had some concern that they might steer individuals away
    from the cash option. To address this concern, Arkansas hired a
    series of nurse coordinators to assist with enrollment, while New
    Jersey added the enrollment activities to the contract of the
    organization that had successfully handled the state's Medicaid
    managed care contract. In Florida, the organizations and
    individuals who provide care management services under the
    traditional system will also handle outreach and counseling under
    the cash option. Special care is being given to separate care
    management and counseling functions. New York's plans for
    enrollment and outreach had not been fully developed at the time
    of our work. 46Selecting a cash option does not ensure that a
    consumer gets to be a part of the cash option group, since half of
    the consumers interested in cash and counseling are randomly
    assigned to a control group. Page 84
    GAO/HEHS-99-101 Severely Disabled Adults Appendix VI Cash and
    Counseling Demonstration and Evaluation Progress to Date
    The states participating in the demonstration are implementing
    their programs over time. Once receiving overall approval for the
    CCDE,47 Arkansas was the first to implement the demonstration and
    began enrolling clients during early December 1998. New Jersey,
    Florida, and New York plan to begin implementation later in 1999.
    In an effort to assess consumers' preliminary interest in a cash
    approach to consumer-directed personal care, the University of
    Maryland Center on Aging conducted a telephone survey in the CCDE
    states. Consumers were asked if they would be interested in a cash
    option for personal care services. Results from these surveys
    indicated an interest among consumers ranging from 32 percent in
    Arkansas (from a sample of Medicaid personal care clients) to 58
    percent in Florida (from a sample of participants in the state's
    aging and disabled waiver program).48 Table VI.1 summarizes the
    extent of consumer interest in a cash model across the four
    states. Table VI.1: Consumer Interest in a Cash Model
    Percentage of consumers State
    interested in cash optiona Arkansas
    32 Florida Physically disabled waiver
    58 Developmentally disabled waiver
    40 adults; 79 children New Jersey
    42 New York
    40 aThese percentages include both consumers answering for
    themselves and surrogates answering for the consumers. In addition
    to determining consumer interest in or preference for a cash
    model, the survey also asked participants if they wanted
    assistance or 47After the states received approval for their
    projects from HCFA in early Oct. 1998, states had to obtain
    waivers from the Supplemental Security Income program. Program
    waivers were necessary because the demonstration allows
    participants to carry funds forward month to month, which could
    violate resource limits under the program. 48For more detailed
    information on the Arkansas survey results, see L. Simon-
    Rusinowitz and others, "Determining Consumer Preferences for a
    Cash Option: Arkansas Survey Results," Health Care Financing
    Review, Vol. 19, No. 2 (winter 1997). Page 85
    GAO/HEHS-99-101 Severely Disabled Adults Appendix VI Cash and
    Counseling Demonstration and Evaluation training for seven
    different tasks associated with the cash option, including *
    deciding how much to pay a worker, * managing payroll taxes, *
    conducting background checks, * arranging for backup care, *
    finding a caregiver, * interviewing a prospective caregiver, and *
    firing a caregiver. Most consumers interested in the cash option
    expressed a need for each of the supportive services. Overall,
    consumers attached the most importance to deciding worker's pay,
    managing the payroll and conducting background checks, and less
    interest in the remainder of the tasks. Results of the telephone
    survey shaped some of the design of the CCDE. In particular, 80 to
    90 percent of respondents expressed interest in a fiscal
    intermediary; thus, choosing an intermediary for payroll
    assistance became a critical component for states' demonstrations.
    Additionally, the survey showed the need for counseling services
    and training, particularly among consumers who wanted assistance
    with the seven tasks noted above. This result underscores the
    integral role that counseling plays in the demonstration. To
    provide sufficient time for consumer enrollment and experience,
    the participating states will be expected to conduct their
    demonstration programs for at least 24 months. Final reports on
    the CCDE are expected to be available 3 years and 3 months after
    the state starts its demonstration. This period of time allows for
    1 year of open enrollment, 1 year of tracking consumers, and the
    remaining year and 3 months for data collection and analysis.
    Throughout the demonstration, however, interim reports are planned
    and will be issued as they are completed. Additionally,
    researchers will conduct a series of in-depth, qualitative
    interviews intended to provide a snapshot of the individual's
    experience with the cash option. A demonstration researcher
    indicated that there may be 25 qualitative interviews per state,
    which will primarily involve the consumer, principal family
    member, paid caregiver, and a counselor. Page 86
    GAO/HEHS-99-101 Severely Disabled Adults Appendix VII Major
    Contributors to This Report Walter Ochinko, Assistant Director,
    (202) 512-7157 Carolyn Yocom Rashmi Agarwal Jerry Baugher Karen
    Doran Richard Hegner JoAnn Martinez Elsie Picyk Mary Reich
    (101727)         Page 87                                GAO/HEHS-
    99-101 Severely Disabled Adults Ordering Information The first
    copy of each GAO report and testimony is free. Additional copies
    are $2 each. Orders should be sent to the following address,
    accompanied by a check or money order made out to the
    Superintendent of Documents, when necessary. VISA and MasterCard
    credit cards are accepted, also. Orders for 100 or more copies to
    be mailed to a single address are discounted 25 percent. Orders by
    mail: U.S. General Accounting Office P.O. Box 37050 Washington, DC
    20013 or visit: Room 1100 700 4th St. NW (corner of 4th and G Sts.
    NW) U.S. General Accounting Office Washington, DC Orders may also
    be placed by calling (202) 512-6000 or by using fax number (202)
    512-6061, or TDD (202) 512-2537. Each day, GAO issues a list of
    newly available reports and testimony.  To receive facsimile
    copies of the daily list or any list from the past 30 days, please
    call (202) 512-6000 using a touchtone phone.  A recorded menu will
    provide information on how to obtain these lists. For information
    on how to access GAO reports on the INTERNET, send an e-mail
    message with "info" in the body to: [email protected] or visit
    GAO's World Wide Web Home Page at: http://www.gao.gov PRINTED ON
    RECYCLED PAPER United States General Accounting Office
    Bulk Rate Washington, D.C. 20548-0001     Postage & Fees Paid GAO
    Permit No. G100 Official Business Penalty for Private Use $300
    Address Correction Requested

*** End of document. ***