Hard Times: The Effects of Financial Strain on Home Care Services Use and Participant Outcomes in Michigan

Purpose: When government funding for long-term care is reduced, participant outcomes may be adversely affected. We investigated the effect of program resources on individuals enrolled in the Michigan Home- and Community-Based Services (HCBS) waiver program for elderly and disabled adults. Design and Methods: Using dates of major policy and budget changes, we defi ned 4 distinct time periods between October 2001 and December 2005. Minimum Data Set for Home Care assessment records for HCBS participants ( n = 112,182) were used to examine temporal trends in formal care hours and 6 outcomes: emergency room (ER) use, hospitalization, caregiver burden, death, nursing facility (NF) use, and permanent NF placement. Controlling for demographics, functional status, and cognitive status, adjusted odds of outcomes were obtained using discrete-time survival analysis. Results: As resources diminished, mean formal care hours decreased, declining most for persons with moderate functional or cognitive impairment, for up to an approximately 30% decrease. In the most fi nancially restricted period, 3 adverse outcomes increased relative to baseline: hospitalization (odds ratio [OR] = 1.10; 95% confi dence interval [CI] = 1.03 – 1.18), ER use (OR = 1.13; 95% CI = 1.03 – 1.24), and permanent NF placement (OR = 1.20; 95% CI = 1.00 – 1.42). Implications: Reductions in resources for home care were associated with increased probability of adverse outcomes. Cutting funds to home care programs can increase utilization of other more costly services, thus offsetting potential health care savings. Policymakers must consider all ways in which budget reductions and policy changes can affect participants.