The significant tax cut legislation that President Trump enacted in July has raised a crucial question for states: With the anticipated decrease in federal Medicaid funding, who should be eligible for home care, and to what extent?
Currently, around 3 million elderly and disabled individuals in the U.S. rely on home and community-based services, which can vary from minimal daily assistance to comprehensive, round-the-clock support encompassing therapeutic care, bathing, dressing, and more. States aren’t obligated to finance these programs, but many opt to use Medicaid funds to provide such services, which constituted two-thirds of all home care expenditures in 2022, according to an analysis by KFF.
Experts in public health predict that states may likely reduce this optional coverage given the federal government’s forecasted $1 trillion reduction in Medicaid funding to states over the coming decade, undermining the years-long advocacy by the disability community for community-based care rather than institutionalization.
In recent years, numerous states have increasingly outsourced the creation of algorithms to private vendors to assess eligibility for these services. Some researchers are concerned that a significant number of these decisions are being made without public oversight or involvement, often prioritizing economic factors over health considerations.
“These tools are often promoted as measures of individuals’ needs; however, their primary aim appears to be limiting eligibility for home care to control expenses,” stated Emily Paul, project director at Upturn, a research and advocacy nonprofit focused on technology.
To delve into how states establish eligibility for home and community-based care and the algorithms involved, STAT spoke with Paul regarding a report she co-authored and released Tuesday, which assessed the algorithms used by five states. She found that the criteria for receiving care, which may seem straightforward, often contain complexities influenced by political factors, with a striking variation among states.
This interview has been condensed for brevity and clarity.
How are these eligibility determinations conducted?
Eligibility doubts arise through a two-step approach: a face-to-face standardized assessment, which states are federally mandated to conduct. This assessment comprises over 250 questions, wherein the evaluator assigns ratings; these ratings are subsequently processed by an algorithm.
What types of questions do assessors ask?
Assessors inquire about functional capabilities, particularly daily living activities such as bathing and dressing, as well as the level of support required. The scale ranges from total independence to complete reliance on assistance. Questions focus on recent experiences, like, “In the last three days, when did you take a bath? Were you able to do it on your own? If not, what type of assistance did you require?” Cognitive abilities are also evaluated.
Meeting or exceeding a specific scoring threshold determines eligibility. Following this, there might be a waitlist, leading to a care planning stage. After eligibility is confirmed, the allocation of care hours is addressed — utilizing the same assessment inputs to guide budget considerations. However, individuals may remain on waiting lists for extended durations.
Who is responsible for making these decisions? The vendors or the state?
As demonstrated in our case studies, state agencies collaborate with vendors to decide on eligibility criteria. The vendors may provide recommendations, but this process varies across states.
For instance, incontinence significantly impacts eligibility in some states but is disregarded in others. The interactions resemble a mechanism where state officials and vendors negotiate an acceptable percentage of those currently eligible who might become ineligible due to algorithm updates.
How do they decide on adjustments to these variables?
Unfortunately, the rationale behind New Jersey’s and D.C.’s exclusion of incontinence remains unclear, while it is heavily weighted in Mississippi. Much of this seems dictated by vendor advice.
For example, Nebraska’s agency held meetings in which vendors suggested that their algorithm was more lenient compared to others. Vendors posed the question: “Do you want to tighten your eligibility since you’re counting individuals as needing assistance for supervision, which some states don’t consider necessary?”
Did agency officials follow this recommendation?
In this instance, the agency chose not to tighten eligibility, preferring to ensure that more individuals who need services are deemed eligible. However, similar behind-the-scenes discussions occur everywhere, with vendors offering recommendations based on practices from other states, leading to negotiations that aim to establish an algorithm that achieves a desirable balance of ineligible individuals.
One vendor remarked that the notion of clear-cut eligibility criteria is misleading while emphasizing the validity of their assessment process, claiming to provide consistent and dependable evaluations for determining service needs. While it wasn’t entirely shocking, it was surprising to see such a candid admission.
Is there evidence that these discussions are taking place in other states?
It’s challenging to ascertain. Missouri demonstrated notable transparency compared to other states when they shared the initial version of their algorithm for public input. An audit revealed that 66% of currently eligible individuals might become ineligible, prompting state officials to recalibrate their goals, aiming for a projected 8% to 9% loss of coverage upon implementation.
Can you discuss the history of these determinations?
The growth of Medicaid home and community-based services began in the early 1980s, driven by advocacy from disability rights activists seeking independent living options and deinstitutionalization. At that time, federal concerns about escalating long-term care costs led to pilot projects exploring the potential to substitute institutional care with home-based services, with the aim of achieving cost savings by restricting services to those who would otherwise require nursing facility care.
From the outset, the objective was to limit home care to individuals genuinely requiring nursing home support rather than prioritizing actual need.
Are you suggesting that these decisions are primarily economic rather than health-focused? Should there be more federal oversight?
We advocate for legislation like the Home and Community Based Services Access Act [currently in Congress], which aims to provide a broader eligibility definition grounded in medical professional assessments. However, we do not necessarily believe that federal standardization would resolve these issues. Our primary concern is that a state’s dependency on automated systems removes the political dimensions of home care eligibility decisions. This report aims to clarify the technology’s role and its political implications. Both agencies and vendors recognize it as a political tool, rather than an objective, scientific methodology. We want advocates to comprehend this and engage critically with the algorithms instead of being drawn into technical discussions regarding accuracy.
STAT’s coverage on disability matters is supported by grants from the Robert Wood Johnson Foundation and The Commonwealth Fund. Our financial supporters do not influence our editorial decisions.
