Let's Talk About the Value of Long-Term Care

Did you see the recent Facebook post from the guy who has decided that he’s not going into a nursing home, he’s going to live at Holiday Inns in the twilight of his years? He’s done the math and determined that he can get better value for his money at the Holiday Inn than he can in a nursing facility.

I hear a lot of these kinds of comments – reactions to the sticker shock of long-term care costs. Comments like: “For that kind of money, I should get …” or “For that kind of money, those things shouldn’t happen …”

In the professional realm, these conversations center around value-based reimbursement, managed care, integrated care models, and outcomes. As intellectual and developmental disability (IDD) long-term care providers, we don’t get a blank check to do whatever we want. We don’t get to raise our own rates. Our clients can only go to approved providers. Medicaid is managed care.

Until the last several years, the majority of our services have been focused on integrated care. We have been responsible for ensuring the health of the whole person – assessing and determining the areas in which our clients need support.

If you want a model for reducing costs and improving outcomes for people, look to IDD services through the years. But as you look, recognize the trade-offs inherent in the exchange.

Low compensation rates mean turnover is constant. Thin operating margins mean going unpaid because of a state or federal shutdown could be the difference between existence or death. Without enormous will, effort and private support, looking to the future, developing innovative services and supports to improve clients’ quality of life, and being able to imagine what’s next, is not possible.

In fact, those who have looked at IDD services have found there’s not much to gain from value-based reimbursement. Why? There’s no fat – no money to pay managed care agencies their slice. And here’s where the whole universe of conversations about value-based reimbursement, integrated care models, and outcomes breaks down for me. I wish it was truly about better outcomes, because then we could talk about increasing, not decreasing, our reimbursement, because of the enormous value we bring. Instead of value and outcomes, the objective is saving money.

Making the Most of It

Let’s talk about what it might cost for long-term care.

$8,000 per month equates to $260 per day for 24-hour long-term care. At first glance, this may seem like a lot of money. Until you consider what costs are included in that $260 per day:

Direct support staffing – the folks who provide support to the person. Staffing ratios vary depending on each person’s needs, from 1:1 to 1:3.
Room and board – the cost of the place to live, ongoing maintenance, utilities, cleaning, transportation, food (including cooking, serving and cleaning up three meals per day, 365 days per year). This is comparable to what you can expect from the Holiday Inn. We receive about $35/day per person for this.
Supervision for direct support staff.
Administrative functions such as billing, payroll and HR.
Nursing support.
Professional staff members who develop programs to assist people to meet their dreams and goals.

LBSA’s average daily reimbursement rate is $255/day. We haven’t received a rate increase since 2014. In fact, in 2018, some of our services received a 7% decrease in rates. We don’t control our prices. The government does.

It’s important to understand why long-term care costs what it does. It’s important to understand the correlation between people’s vulnerability, the amount of care it takes to support safety, and the cost of that care.

Beyond that, there’s a direct correlation between declining reimbursement and the ability to engage in quality improvement.

Digging Deeper

At Laura Baker Services Association, historically, our community support efforts – volunteers, donations, community partnerships – are budgeted to go toward quality improvements and unmet needs. As our reimbursement has stagnated and costs have continued to increase, more and more of that community support is directed to our core services and supports.

In an era of increasingly tighter budgets, we continue to work endlessly to gain more support. We continue to possess the will to move forward. We continue to develop innovative services and supports. We will continue to look to the future and to imagine what’s next. Our clients – the people we have the privilege of serving each and every day – deserve nothing less.

We need your help and your financial support. We need partners who understand the unique challenges we face, understand our unique value to the community, and who take the time to understand and educate others about that value.

We need you to support our advocacy efforts, and to share what you learned with your friends and neighbors.

Will you join us?