Medicaid Long-Term Care Spending for Community-Based Care, FY 1999

In 1999, Medicaid long-term care spending topped $62 billion. Of this amount, 74 percent, or $46 billion, was allocated to fund long-term care institutions such as nursing homes and intermediate care facilities for the mentally retarded (ICF/MR). The remaining $16 billion was spent on community-based care for people who otherwise would be in an institution.

An historic Supreme Court decision, Olmstead vs. LC (1999), encourages states to reevaluate how they deliver publicly funded long-term care services to people with disabilities. The court ruled that it is a violation of the Americans with Disabilities Act to discriminate against people with disabilities by providing services only in institutions when certain individuals could be served in a community-based setting.

As a result, legislators, executive branch officials, consumer advocacy groups and individual citizens are working together to implement the Olmstead decision around the country. In some states, almost half of Medicaid long-term care spending supports community-based care for people who qualify for institutional services. As a result, many more people with disabilities receive services in their homes and communities, which generally are less expensive than institutions.

At least 37 states have formed advisory groups or commissions to develop state plans or draft white papers to address issues surrounding the Olmstead decision. States that rely heavily on institutional care may benefit from other states' experience as they plan to implement the Olmstead decision by developing community-based services.

For more information contact Jo Donlin, (303) 364-7700, fax: (303) 863-8003, jo.donlin@ncsl.org. See also http://www.ncsl.org/programs/health/health.htm.