Sending Granny (and Gramps) to the Home

Author’s Note: This is the fourth in a series of articles about Nebraska’s Medicaid program, the Unicameral’s apparent intent to expand it, and the many reasons why expansion is an uncommonly bad idea. Although they don’t have to be read in order, here are links to the previously-published articles in the series, and see the bottom for the complete list:

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In the last article, I began a discussion of the ways in which Medicaid and similar entitlement programs affect human behavior. Specifically, I demonstrated how entitlement programs present a moral hazard. In general, I concluded that each of us, being human, are attracted by the promise of getting something of value for little or nothing expended, in time or treasure, on our own part. Although the moral values supporting self-reliance and personal responsibility that were held by previous generations of Americans worked to keep this type of self interest in check, entitlement programs have eroded or supplanted those moral values in recent generations by assuring recipients that they deserve the benefits they receive by virtue of merely existing. In other words, they are entitled to them. And if recipients are entitled to any and all benefits they receive, it follows that others can and should be compelled to provide and pay for those benefits.

But is that happening in Nebraska? We’re all solid, pioneer stock here. The salt of the earth. The backbone of the nation. Conservative, independent, and self-reliant. The place where rugged individualism reigns supreme. Surely, if there’s somewhere on earth where the inhabitants are still immune to the sense of entitlement, it’s here in Nebraska. . . .

Or is it?

Beginning when Paul Ryan announced his plan to “save” Medicare and, because Ryan became the Republican nominee for vice-president, extending through the campaign season, Democrats likened Ryan’s plan to “throwing Granny over the cliff.” They even made and ran a television commercial to that effect.

But the very same people who vilified Ryan in this manner and who support expansive Medicaid and Medicare benefits are guilty of condemning our elderly to what many of them consider a fate worse than death — life in a nursing home.

In the second article in this series, I demonstrated that approximately seventy percent (70%) of the Medicaid funds that are spent to provide care in Nebraska are either for care that is optional under federal Medicaid law or for populations for whom coverage is optional under federal law. The lion’s share of that money is spent to pay for long-term care for elderly Nebraskans.¹ Optional services provided to elderly individuals not required to be covered under federal Medicaid law are typically home and community-based long ...continue

A group of policy analysts studied and proposed reforms to Nebraska’s long-term care system in 2003. In their report they posed the following question:

“How is it that America and Nebraska ended up with a welfare-financed, institution-based long-term care system in the wealthiest country in the world where no one wants to go to a nursing home?”

They answered their own question as follows:

“Nearly forty years of providing nursing home care through Medicaid, and to a lesser degree, providing home care and nursing home care through Medicare, have anesthetized the public to the risk of long-term care. Medicare has no means test. Medicaid’s long-term care eligibility restrictions on income and assets have proven extremely elastic. They allow middle- and upper middle class Americans to avail themselves increasingly of benefits originally intended only for the poor. The public has avoided for decades, thanks to Medicaid and Medicare, what would have been far more severe financial duress resulting from long-term care crises. Therefore, most people do not place a high enough priority on paying privately for long-term care to save, invest or insure years in advance against that risk. Nor do they feel impelled to tap the equity in their homes to pay for long-term care. Consequently, more and more people are becoming dependent on public programs that are less and less able to support them financially.”

What the study’s authors were referring to is the practice of spending down the financial resources available to an elderly person for the purpose of making him or her Medicaid-eligible. The net effect of the practice is to make all of us pay for that person’s care in a nursing home while his or her own money is passed on to heirs or other beneficiaries.

According to the authors of the study, this practice is increasingly common in Nebraska. Those interviewed for the study “spoke proudly of Nebraskans’ pioneer spirit of independence and self-sufficiency,” but, at the same time, admitted that “more and more Nebraskans are coming to believe that because they paid their taxes, they have a right to receive government-financed long-term care and to pass an inheritance to their heirs.”

In conclusion, I can only echo the observation of the authors of the long-term care study: “Such public sentiment is becoming an irresistible political force that will soon impact (if it has not already) the immovable economic object of fiscal reality.”

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This article series is about Nebraska’s Medicaid program, legislation introduced in the Unicameral aimed at expanding it, and the many reasons why expansion is an uncommonly bad idea.

This first grouping of articles don’t necessarily have to be read in order as they are research, principle, and policy focused:

This next grouping of articles report events affecting the progress of legislation in the Unicameral, listed in the order in which they were published:

Unicameral’s Health Committee to Hear Medicaid Expansion Bill (LB577) Feb. 28th
It’s Funny? Even If Medicaid Expansion Saved Money, Citizens Wouldn’t See a Penny
Nebraska Medicaid Expansion: LB577 in Limbo
Senator Bob Krist Withdraws As Co-Introducer of Medicaid Expansion Bill (LB577)

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Images in the post were found at the following links…

Elderly person’s hands photo

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Notes & References [ + ]

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Optional services provided to elderly individuals not required to be covered under federal Medicaid law are typically home and community-based long term care services rather than residential care in a nursing home. It’s my understanding that the latter has been covered under federal Medicaid law since its enactment.