Downsizing and diversion: strategies to reduce Medicaid long-term care expenditures

In their efforts to control escalating Medicaid costs, some states have focused on shifting their long-term care system from predominantly institutional services to home- and community-based services. Two strategies states have employed that may be of interest to case managers are: (a) downsizing the overall supply of nursing home beds and (b) diverting consumers from nursing facilities before they are admitted. Both strategies of downsizing and diversion can impact case managers in that the array of services from which they can choose and the process by which they plan their clients' care can be affected. This article describes some of the approaches that states have used to decrease the use of institutional services including bed moratoria, bed buy-back, and pre-admission screening; the problems that they have encountered; and the role of case managers in assisting states to ensure access to services while controlling costs. The article summarizes some of the findings presented in Reducing the Cost of Institutional Care: Downsizing, Diversion, Closing and Conversion of Nursing Homes, which was developed for a meeting sponsored by the University of Minnesota/National Academy for State Health Policy National LTC Resource Center, entitled "The Cost of Institutional Care: How to Get Around the Roadblock to Medicaid Reform," funded by the U.S. Administration on Aging.