Measuring State Medicaid Home Care Participation and Intensity Using Latent Variables

Population aging and policies to redirect long-term care toward home- and community-based services have led to increases in Medicaid home care spending in most states. Changes in state Medicaid home care policy generosity may result from changes in the number of persons served (i.e., Participation) and/or changes in quantities of services covered (i.e., Intensity). This study measures state Medicaid home care Participation and Intensity comprehensively using latent variables, and uses those latent variables to describe changes in Medicaid home care policy generosity over time and across states. Yearly state-level data from the Medicaid Statistical Information System (1999-2012) are analyzed using exploratory and confirmatory factor analyses. Between 1999 and 2012, 29 states expanded both Participation and Intensity, whereas six states reduced both. In the remaining states, a trade-off occurred. Distinguishing between Medicaid home care Participation and Intensity deserves attention, as expansions along these two dimensions represent potentially different implications for beneficiaries.