- TITLE: States’ Experiences Implementing Consumer-Directed Home and Community Services – Results of 2004 Survey of State Administrators, Opinion Surveys, and Telephone Interviews http://www.consumerdirection.org/pdf/ConsumerDirectionFullReport.pdf
- Author: Donna Lind Infeld, Ph.D., Professor and Program Director of the Masters of Public Administration Program in the School of Public Policy and Public Administration at George Washington University. The National Association of State Units on Aging (NASUA) and the National Council on the Aging (NCOA sponsored the report. (Katherine Cargill-Willis 5/04/05)
- Consumer Directed Care (CD): This report summarizes the “state of the states” on consumer-directed home and community-based services (HCBS) for seniors in the U.S. In 2004, two surveys and one set of interviews with state administrators about consumer direction for older people were conducted under a Robert Wood Johnson Foundation project, “Promoting Consumer Direction in Aging Services.” Consumer-Directed HCBS services give consumers maximum choice and control. They allow consumers to assess their own needs, determine how and by whom these needs are met, and monitor the quality of services received. Consumers may be able to:
- Select, manage, and dismiss their workers
- Choose which services to use
- Choose what providers or workers to hire
- Decide what time of day workers will come
- Decide whether to hire family members
- Decide whether to spend available funds on things other than services (like appliances or home modifications)
The consumer-directed model has become a more widespread option for seniors who need help to stay in the community HCBS in the U.S. ranges along a continuum from agency-administered models to consumer-directed (CD) services. CD defining characteristics are that it allows persons with disabilities considerable choice and control over how they receive supportive services and from whom. Some CD programs expand the participant’s control further by providing a cash benefit with which the participant can purchase services or pay caregivers, including family members.
When the Program Began: CD services for seniors people are emerging at an increasing rate this decade, with 38% of the programs identified in the survey having begun in the last five years. By comparison, 24% began in the decade of the 1990s, and 24% began in the 1980s. In the early 1980s, Medicaid started funding consumer direction programs and since 2001 Older Americans Act (OAA) funds have contributed to its growth.
The Numbers: CD programs have an average of 1,435 participants, but they range widely in size. Four in ten have 1 to 500 participants (43%), yet 14% have 2,000 or more participants. The cumulative number of seniors served by consumer direction is approaching 70,000. Most people said that there are many more older people who would be appropriate candidates for CD services than are receiving them.
Program Funding: When respondents were asked to indicate the source that funded their CD programs in FY 2003, 43% cited Title XIX Medicaid 1915(c) HCBS services waiver program. Two in ten programs rely, at least in part, on funds from the state (26%) and on Title III Older Americans Act funds (22%). Other funding sources include Title XIX Medicaid Personal Care (PC) Option (3%); county/municipal funds (3%); other Medicaid waivers (3%); and other sources not specifically identified (12%).
Program Costs: In 2002, program funding varied from less than $3,000 to $187.5 million. In 2003, costs ranged from $20,000 to $187.9 million. And in 2004, budgets ranged from $10,000 to $206 million. In 2002, average spending for programs totaled approximately $19.8 million. This increased only slightly to $20 million in 2003 but it was estimated to reach $25.5 million in 2004. Among the programs that have been in operation since 2002, the average program cost from $22.5 million to $30 million in 2004.
Provider Payment Methods: When asked how providers are paid, in 41% of the states an intermediary reimburses the provider, 23% of the programs pay the providers directly, 15% give consumers vouchers to obtain services and 10% of programs give the consumers cash to pay providers themselves.
Program Eligibility: Most programs impose a combination of age, disability and financial criteria to determine eligibility for consumer direction. Smaller programs with fewer than 500 participants are most likely to use disability as an eligibility criterion, while larger programs more often use either age or age and financial requirements. Essentially all (97%) Medicaid-funded programs require financial eligibility criterion, with most also imposing disability (90%) and (age 63%) requirements. Most OAA-funded programs impose age requirements (80%), but they also require some level of disability (100%) and none use financial requirements.
Who Can be Paid: Eighty-three percent of programs allow payment to friends or neighbors, home care service agencies (81%), and relatives (79%). About seven in ten say other individual providers who are not relatives or friends (72%), or certified home health agencies (69%) are not eligible. Sixty-six percent of programs do not permit spouses to be paid providers and one-third do not allow parents to be paid providers (33%).
Counseling, Case Management, and Training: Only 20% of CD programs require counseling and 26% require training for consumers who use CD, but they are more likely to offer supportive services. Nearly all programs (93%) provide information and/or counseling about the services they provide. Seventy-two percent offer training services and sixty-eight percent offer traditional case management services. Medicaid-funded programs are more likely to require counseling than OAA- funded programs. Ninety-one percent of the programs provide training on selecting qualified workers; 79% provide training on communicating needs and preferences and on supervising workers; 71% train on how to dismiss workers and 44% train on handling payroll and taxes.
- States Are at Different Levels of CD for Seniors: One state unit on aging (SUA) recently received a small grant from NASUA, in partnership with the state’s Alliance on Aging, to work with advocacy groups to explore developing CD. The SUA is holding focus groups with OAA programs and participants, those in aging networks, consumers and their family caregivers, advocates, providers, and local officials discussing consumer-directed services and other aging services. Several other states are in the early stages of enrolling participants. Another state with an Alzheimer’s disease demonstration grant offering CD has 31 participants.
Limited Scope: Several states said they offer CD but require that care be provided by agencies. They described CD as allowing the consumer or family caregiver to have input to the care planning process, but the consumer cannot hire, dismiss, train, or direct their care. Since this definition of CD services is inconsistent with the one used in the field and in this report, these programs are not in the narrative from the interviews but are included in the survey responses. Another example of offering a limited scope of CD is a “hybrid” CD model where most of the care is provided by licensed home care agencies, approximately 10% is consumer-directed, using non-agency individual providers and paid through Medicaid. This option is mostly used in rural areas where it is not cost effective for home care agencies to operate or with consumers who have not been successful in working with agencies. While the consumer can find his/her own personal care attendant, the program nurse is responsible for hiring and supervision. A different modification of CD allows consumers to hire and dismiss their workers, do their own training, and direct their own care; however, the worker must be an employee of an agency.
Established CD Programs: States in the next stage of development offer one or more programs that allow for clear CD. The key issue is if the services are offered with choice and control. An example is where a social worker develops care plans for consumers who can then hire either agency or non-agency personal care assistants, and can decide what will help them remain as independent as possible. Another example of moderate development is a state funded home services program that started in 1987 and added consumer direction in 2001. While there are approximately 11,000 in the overall program, 140 are in the consumer-directed program. Another state participates in an Agency on Aging (AoA) Alzheimer’s demonstration providing services to family caregiver, including case management and other gap-filling services in which thirteen percent of services are provided as “Grants to Families” that pay for hiring in-home aides, buy prescription medications, or pay for personal care aids.
- Findings
Home and Community-based Services (HCBS):
- Three-quarters of the 40 states that responded to the data survey offer consumer-directed HCBS programs,
- Of the ten states not currently operating a CD HCBS aging services program, four cited the lack of resources as the reason not to implement the program and only 10% believed that CD programs were not a good alternative.
- The other half cited other reasons; such as the program is in development; the long-term program is being re-designed; or the state is considering applying for support for CD.
- 23% have one HCBS aging program offering CD options; 28% have two programs that offer consumer-directed options; 18% have three programs; and 5% have four or more programs.
Consumer Direction Awareness and Knowledge:
- 85% of respondents rate their own awareness of these programs as a 4 or 5 on a 5-point scale, with 60% giving the highest rating.
- 47% of the respondents reported that their managers or supervisors were very aware of such programs (giving them 5 on a 5-point scale) and 22% gave their manager or supervisor a 4 on the 5-point scale.
- 73% rated their own knowledge about CD programs for seniors a 4 or a 5.
Examination of Experiences and Perceptions about Consumer Direction:
Influences on Development of CD for the Elderly: State aging directors were asked to rate on a 5-point scale to what degree certain factors influenced them in developing CD HCBS aging services:
- 71% reported that they perceived gaps in service delivery;
- 65% reported that consumer demand had a strong influence on the development of CD HCBS programs for seniors. These perceived gaps were more significant to directors developing programs than those who already had programs.
- 53% reported that they were influenced by new federal initiatives and even more directors who were currently operating programs reported that federal initiatives than those who did not have programs.
- Only 31% stated that success in other states has had an influence on their decision to develop consumer-directed programs in aging services.
When asked to explain the factors that influenced their decision to develop CD HCBS aging service programs, many gave reasons why these programs are better than traditional HCBS for some seniors:
- CD services better fit consumers’ needs;
- People can’t get traditional services they want when they want them;
- With CD consumers can be assisted to participate in community activities, like shopping or going to church; unlike traditional services;
- Consumers are concerned about not having the same person consistently providing care;
- Agencies tend to more conservative than consumers would like in terms of the types of care they provide.
CD addresses cultural diversity: CD is particularly good at meeting the needs within specific cultural groups. Some groups are more comfortable relying on family members or others of the same background to provide their care.
CD addresses needs in rural areas: Fourteen out of twenty states noted that CD maintains an adequate workforce and fills service gaps in rural areas because it gives rural consumers more options. Since it is hard to find providers in a rural area because of the travel time, it is helpful that consumers can use their neighbors rather than having to get someone from the next town.
CD addresses needs of non-traditional and hard-to-reach consumers: Family members tend to be more committed and willing and find ways to deal with that issue.
CD allows consumers to get more service for the same state money: Consumers receive more services to fill gaps because they can negotiate rates of pay with workers.
CD addresses constraints caused by licensing requirements: CD is helping to build up the workforce and allowing family caregivers to provide services that better meet individuals’ needs and preferences.
Consumer demand and advocacy: Consumer demand and advocacy are almost as important as gaps in services and shortage of providers in terms of affecting states’ decisions to pursue consumer direction. While most said that consumer demand was influential, they generally noted that younger people with disabilities were more vocal than older consumers. Some said that they really didn’t hear very much from seniors about consumer direction and most of the support came from the disability community.
Success in other states: Thirty-one percent of state aging agencies reported that successes in other states influenced them to develop consumer-directed programs. They stated that Cash and Counseling programs, information from conferences where other states described their experiences, and reading about other states’ experiences, as factors that influenced their decision.
The right thing to do: When presented with an open-ended question relating to other reasons why they pursued CD many said, “it was the right thing to do.” Two states reported that this was the most important reason they developed consumer direction.
Barriers to and Problems Implementing CD the Elderly:
When state directors who had HBCS programs were asked how difficult it was to implement a CD HCBS aging program, 33% said it was very difficult; 40% reported a score of three on a five point score, but none said it was “very easy.”
Medicaid waivers and consumer direction: Forty-one percent of the respondents expressed the most concern about federal Medicaid laws, rules, and regulations. Positive comments included:
- The Independence Plus “template” was helpful;
- The waiver application process was “pretty efficient;”
- Federal Medicaid rules and regulations have “lightened up” to make CD a reality.
Several states would like to expand their coverage to allow greater flexibility about what goods and services can be purchased under consumer-directed waivers. Other barriers prevent consumer direction from being used when consumers are already enrolled in another program and when states require that state plan services be exhausted first.
State laws, rules, and regulations: Forty-one reported concern about state Medicaid laws, rules, and regulations. Of specific concerns are nurse delegation laws and health regulations that affect delivery of medications and medical treatments by non-licensed personnel. The most specific state-level barrier to consumer direction deals with workers’ compensation requirements. Issues include:
- Problems with developing a system for paying into workers’ compensation and dealing with labor laws;
- The fiscal intermediary was not allowed to pay directly into workers’ compensation in one program;
- The demonstration programs offered in several states only have a limited number of spaces.
Lack of Funds: Forty-four percent cited inadequate funding and 44% reported poor compensation and benefits for caregivers as problems. Thirty-eight percent indicate a problem with a reduction in funds; 26% reported that inadequate quality of services was problem in their state, and 15% indicated fraud or misuse of funds, abuse or exploitation of consumers as significant problems. Thirty-one percent were concerned about the lack of funds. Many states felt they had inadequate resources to build the necessary infrastructure, implement a program, arrange for a fiscal intermediary, and train staff. New services and the increase of program participants have added to state Medicaid matching costs.
Resistance from appointed and elected officials: The experience of the twenty states (23%) that were concerned about barriers to consumer direction caused by resistance from appointed and elected officials ranged from receiving strong support from their governors to staying “below the radar screen.” In most states, there is concern that legislators oppose consumer direction for a range of reasons. State units on aging also reported some success in dealing with resistance among policymakers and other influential leaders.
Resistance within aging agencies and human services departments Resistance from within the state unit on aging was least likely of all of the potential barriers to hinder development of CD. Still 15% of respondents were concerned or very concerned about this factor.
Quality concerns While ten percent of the states were not at all concerned about quality of care under CD, 13% were very concerned. State managers who were not concerned about quality of care (31% not concerned or not at all concerned) offered general comments about how control over the time and location of care means better quality for consumers, pointing to evidence of letters of appreciation.
Resistance from long-term care providers: Forty-four percent of respondents were concerned or very concerned about resistance from long term care providers. This was also one of the stronger messages heard throughout the interviews, reported most frequently as the single primary barrier to implementing CD. To prepare for this resistance, states have identified the need for the agency directors to talk with legislators about consumer direction, using statistics from other states to show how well it works and lay the groundwork to gain support. Cultural changes need to take place for provider agencies and professionals, including licensed personnel and case managers, to feel more comfortable and embrace consumer direction.
Problems with financial administration of CD: States reported problems with both voucher and fiscal intermediary approaches to paying for services. One state reported that most of their family caregivers would prefer not to use vouchers because they have trouble completing them correctly and figuring out who needs which copy. Contracting out the payroll process has also caused some “bumps in the road.” One state reported difficulty with claims processing because the consumer-directed program, which is not administered by the Medicaid agency, has a different software system that has problems exchanging data with the Medicaid system. Technical assistance focused on critical financial issues such as how to get the cash to people and who does the tax withholding. There are difficulties in the financial process from the consumer’s perspective as well.
Lack of consumer information: Lack of communication and consumer awareness about consumer direction was described repeatedly. Consumers simply don’t know about what’s already there. Many older people don’t attend programs at congregate sites where they could hear about services or read about these programs, especially in the rural areas.
Favorable Factors and Outcomes of Consumer Direction for the Elderly: When respondents were presented with five factors that might be favorable outcomes of consumer directed HCBS services, 81% gave providing choices for consumers and empowering consumers a 4 or 5 on a 5-point favorability scale; 59% indicated improving access to service has been highly favorable in their program implementation; and 53% said addressing workforce shortages was highly favorable.
Cost-savings expectations and experience: New funds were critical in helping states develop the necessary infrastructure to run CD programs, particularly for establishing complicated fiscal intermediary processes and supporting training activities. While some people may view consumer direction as a way to save money, some states are finding that frail elders with greater needs are selecting consumer direction and therefore costs are high. The maximum spending allowed on a CD waiver isn’t always adequate to purchase the care or goods that are needed. Others are finding that while the program is cost-neutral to the state, individual consumers can get more hours of service for the same dollar amount. There is concern that decision-makers will see CD as a way to increase services without increasing budgets. Some think it will save money and they can simply cut budgets. There is concern that this idea is creeping into the thought process about consumer-directed care. One state argued that savings in nursing home dollars should come back to home and community based programs.
States Are Addressing Quality Concerns and Monitoring Consumer Satisfaction: When asked how they ensured that consumers’ needs are met, the most common technique (78%) employed consumer satisfaction assessments and/or surveys. Sixty-nine percent used internal case review processes and another 69% used criminal background checks to ensure quality. In addition, 62% conducted program evaluations and 57% require certification of professional provider. Forty-eight percent provide for emergency back-up, 43% monitor services through traditional case or care management and 41% have external case review processes. States have widely variety of ways to measure success other than consumer satisfaction. States that participated in the RWJ Cash and Counseling Program had a detailed evaluation completed by Mathematica Policy Research. Based on this range of quality assurance and assessment methods, respondents reported a moderate level of confidence in their ability to measure program success. Forty-three percent are either confident or very confident while only 10 percent are not confident in their ability to measure program success.
Older consumers are generally happy with CD: Seventy-eight percent of the state aging directors indicated consumer-directed HCBS aging services programs are highly beneficial to consumers and six percent believed that the programs are not at all beneficial. As a result of satisfaction surveys and other monitoring systems, state units on aging have a pretty clear picture of consumer reaction to consumer direction. In general, they report that recipients are quite positive about it. Family caregivers like being able to give input about how to spend the resources, but they don’t always want the extra responsibility. Younger elderly (60–65) seem to embrace consumer direction while the oldest old are “a little leery.” Virtually all of those who get services have very high satisfaction.
- Effective Practices: Twenty-one states reported a total of 43 effective new practices. While 18 states reported no effective practices, 10 reported one, 5 reported 2, and 4 reported 3. Two states identified five or more. Thirty-seven percent of respondents reported the development of practices that provide effective educational materials to consumers, while 27% developed practices that improve the quality of long term care services. In addition, 23% reported effective practices for combining with another program. Other new practices involve reaching out to rural consumers (20%), dealing with regulatory/policy barriers (20%), and reaching other hard-to-reach consumers (13%).
Practices to improve quality of long term care services: Several focused on improving quality of services provided to various ethnic groups. One Alzheimer’s grant focuses on Hispanic family caregivers and people residing in outlying areas of one county. What they heard from those who used consumer direction was that they felt comfortable with the person they knew, their belief systems were valued because they had a person of the same ethnicity/race/culture, so they felt they had an increased quality of care because the person knew them, their needs and wants, and could deliver care in the manner they wanted. Screening for appropriate use of a CD model is critical, because it is not for everyone. Figuring out how to draw that line, and balance protection with autonomy is the real key to success of the model. Explaining to providers that participation in consumer direction is voluntary has also pushed back their fears.
Educational materials and information practices Having recognized the widespread lack of information about consumer direction, many states have developed effective practices to address this problem. States are generally very proud of their educational efforts and satisfied that they are starting to make a dent in the general lack of knowledge about CD in the community. Examples of effective consumer education activities include:
- Educational materials specific to CD provided as part of the “Counseling” component of Cash and Counseling;
- Booklets for agencies and senior centers on self-directed care and hiring in-home help
- Annual conferences on personal care for consumers, providers, and agencies including information on CD.
Practices to reduce gaps and increase supply of providers: Several states have described effective CD practices that help them fill service gaps and add to the supply of providers. While consumer direction can potentially alleviate some of the workforce shortage, its effect is very small at this point.
Practices to address Medicaid waiver issues: States described several administrative strategies to address Medicaid waiver issues. Some examples include:
- Combine consumer direction with existing waivers so as to not need to apply for a new one.
- Pick up some of the services for people on the waiver through the Medicaid personal care program.
- Create a fiscal intermediary model that can serve the CD waiver and the developmental disability waiver.
Practices to address state policy issues: State units on aging are showing considerable initiative in working through various policy barriers and developing effective practices. For example, they are:
- Coordinating with the state’s Medicaid program, to assist people who are in (non-Medicaid) CD program (administered by the state unit on aging) to apply for Medicaid;
- Developing a single waiting list for all HCBS services to ensure that elders receive other services while they wait for CD;
- Making policies work across funding sources and populations to ensure CD fits within a common infrastructure;
- Building support for CD programs during the pilot stage so they can be maintained after grant funding expires;
- Creating a CD coordinator position to coach, teach, and monitor consumers to ensure exploitation does not occur;
- Developing an online process including applications, budgets, employment costs, a FICA formula, and tax forms;
- Trying to change labor laws to be more conducive to consumer direction;
- Reviewing the regulatory processes across aging, disability and health care financing.
Practices to address cost effectiveness: States have developed a number of effective practices to ensure the cost effectiveness of CD programs. One state uses the “Care Call” system to monitor the time providers are delivering care. In this system workers are required to call a central number when they arrive in the consumer’s home and again when they leave. In the first couple of months the state saved several million dollars because the program only paid for actual provider time in the home.
Practices to address provider resistance: One practice that was found to be effective in building provider support was to allow agency care in the daytime and CD services at night. Another state unit on aging addressed provider resistance by holding meetings and making a series of presentations. Providers seemed to think that consumers were being encouraged to leave agency workers. In response, they were given the message that if they are really providing what the consumer wants, the consumer will stay with them. Getting to the right person at the right time helps move development along. Respondents indicated the need to win people over to support consumer direction. Individual personalities clearly affect acceptance of this approach.
Practices learned from providing consumer direction to younger persons: States reported a wide range of things they learned from CD services for younger persons that helped them in implementing their aging programs, including:
- How to educate individual consumers about being an employer;
- How to “tweak” services to make them more age friendly;
- How to work with a limited budget and be more flexible with spending;
- How to use fiduciaries to handle payroll, employee hours, and taxes;
- Most people think that CD only refers to personal care attendants, whereas the disabilities community has a very open mind about CD which has helped aging agencies broaden their definitions to provide a wide array of services;
- Age is not a factor in determining success of or desire for a CD program, but what works for seniors may not work for younger consumers;
Practices related to use of the media: Four state units on aging described substantial media coverage for consumer direction. In one, the governor held a press conference resulting in articles and editorials. As a result the state unit on aging was flooded with calls, especially from other states. The response was too overwhelming and generated more demand than they could handle. Another governor was on the "News Hour with Jim Lehrer" talking about CD. Media exposure has generated interest among professionals, especially about how to market consumer direction. A state that has been involved in the Cash and Counseling Program described an overwhelming and positive reaction from the media. The Robert Wood Johnson Foundation hired a public relations firm to help states develop key messages including outreach staff talking about consumer direction in local communities.
- The Policy Environment and Olmstead:
Consumer Direction for Older People Generally Works Well and Fits with States’ Policy Directions: When asked to rank how well CD services for older people are working (from 1 = not working at all to 7 = working extremely well), fifteen out of twenty, (75%) provided scores ranging from 3 to 7. Forty-nine percent indicated that HCBS programs are compatible with the direction in which other programs are moving and 46% said HCBS programs are compatible with the skills of their current staff. However, a few states said that, at least as viewed from the Department of Aging, CD is not really a priority. Another reported that Medicaid, in general, is a higher priority; instead getting funding to expand existing services to alleviate the waiting lists is a higher priority. Further, because of the small number of programs and people involved, CD was not seen to be a driver of policy direction.
The relationship between Olmstead Plans and CD in the states varies widely. Several states said they did not see a direct connection because their Olmstead focus is on information and access, not on service delivery. While some states indicated that there was no formal reference to consumer direction, it was clear that the purpose of the Olmstead plan was consistent with greater consumer control and increased access to information about community-based services. On the other hand, some states saw clear and direct linkages between their Olmstead plans and consumer direction. Some state directors are on their state’s Olmstead Task Forces. Several states are using nursing home transition grants to support their Olmstead plans. For example, one governor’s goal is to move 1,000 disabled and elderly residents out of nursing homes into affordable homes with CD services. CD plays a prominent role in many state aging plans and policy agendas. In some cases it is specifically mentioned in state plan goals. Five states described actions by their governors that sent signals of support for CD. One state is submitting a grant specific to CMS for “Money Follows the Person.” In some states, the policy priority for consumer direction is directly tied to Olmstead activities.
Cash and Counseling programs have shown the program does save money in the end but expenses are front-loaded and there are costs at the beginning. Federal Medicaid match is available for administrative costs that allow for the needed infrastructure investment. When respondents were asked about increasing CD services in publicly funded programs for older adults, 80% indicated it was a good idea or a very good idea. While 15% percent were neutral, none reported that it was not a good idea.
While most states are currently only providing CD to a few hundred older people, a number of states have extensive, longstanding, and well-developed CD programs that serve thousands of seniors. The lack of general understanding about consumer direction, among the public as well as professionals, is a clear barrier that states are working to address. States were definitely motivated to pursue this approach by staff shortages and perceived gaps in services, particularly in rural areas. Federal initiatives, including available funding, also influenced states to pursue consumer direction. State units on aging are using several funding sources, including Medicaid, Older Americans Act, and state general revenue funds, to infuse consumer direction into a wide range of programs.
- States’ Goals for Consumer-Directed HCBS for the Elderly: States’ high level of interest in consumer direction is reflected in the range of activities states hope to pursue in the future:
- One state is developing a statewide reform agenda that focuses on consumer direction;
- Several states want to take Alzheimer’s and other demonstration programs that offer CD statewide;
- Consumer direction fits into a broader agenda in some states;
- Some states hope to expand the array of programs to which consumer direction can be applied;
- Some states are combining programs and services;
- States are strengthening the definition of consumer direction;
- One state plans to incorporate consumer direction with managed care;
- State reorganization may provide an opportunity for consumer direction in one state;
- States are applying for funding to support consumer direction.
