Formal, or paid long term service and support (LTSS) have estimated annual costs of $211 to $306 billion in the U.S. and these expenditures are expected to rise as Baby Boomers age. Demographic trends including smaller family sizes, increased female workforce participation, and longer lifespans will reduce the availability of family caregivers, placing further burden on the formal LTSS system and especially on Medicaid, the nation's largest single payer of formal LTSS. Medicaid has been at the forefront of policy efforts to rebalance LTSS from institutional to home-and community-based settings. These rebalancing efforts reflect individuals' preferences to receive home- and community-based services (HCBS) and these transitions have also been shown to save about 15% in per capita LTSS spending over 10 years. In spite of this increased focus, evaluations of these rebalancing policies have largely neglected health and mortality outcomes, disparities in outcomes, and effects on older adults with specific health conditions such as dementia, who may have higher than average Medicaid expenditures. The most recently implemented rebalancing policy is the Balancing Incentive Program (BIP), which offers additional funding to states to increase access to LTSS in states that were spending less than 50% of LTSS expenditures on HCBS. We will conduct the first formal evaluation of BIP's effects on four health outcomes: self-rated health, functioning, long-term institutionalization, and mortality. There is reason to suspect that disparities in these outcomes may also be affected after BIP's implementation, as whites and minorities tend to employ very different LTSS strategies and have different levels of access to care. Similarly, individuals living in rural areas are more likey than their urban counterparts to have few or distant medical providers and fragmented care coordination, all of which limit their ability to obtain necessary care and adversely affect individual and population health outcomes. This proposal employs a mixed-method approach to (1) conduct qualitative analyses to identify states' BIP implementation stages and challenges; (2) test the effect of BIP implementation on the four health outcomes using a difference-in- difference approach that capitalizes on the quasi-experimental framework to compare states that did and did not (but were eligible to) implement BIP; (3) assess racial/ethnic and rural/urban differences in BIP's effects on health; and (4) examine whether health conditions and access to informal care (unpaid care generally provided by family), and county- or state-level access to formal care further modify the effects of BIP on health outcomes and disparities. Multiple administrative and survey databases spanning 2008-2017 will be merged to examine health outcomes for dual-eligible adults 65 years and older who live in BIP and non-BIP states. The goal of this study is to provide policymakers with rigorous analyses of BIP's effects on health and health disparities. While these analyses focus on BIP, the results have implications for HCBS more generally and for understanding how rebalancing policies influence health and health disparities in older adults.
This proposal evaluates the U.S.'s most recent long-term services and supports (LTSS) rebalancing policy, the Balancing Incentive Program (BIP), which bolsters participating states' ability to increase access to care in home- and community-based settings. We will examine how BIP implementation influences older adults' self- reported health, functioning measured by activities of daily living, risk of long-term institutionalization, and ris of mortality. Further, we test whether BIP implementation reduces or exacerbates existing racial/ethnic and rural/urban disparities in these outcomes. We also examine whether these effects vary by an individual's health conditions, access to informal (unpaid) care from family members, and access to formal (paid) care at the county and state levels.