Granted In Vain: State Turns Down Cash For The Elderly And Disabled

State Turns Down Cash For The Elderly And Disabled

\ Jun 21, 2012

6 min read

A growing number of families are facing the decision of whether to place a loved one in a nursing home. It’s often a painful choice. Institutions can mean the loss of familiar comforts, routines, social connections and independence—all of which amount to compromises in overall quality of life.

People who speak out on behalf of the elderly and the disabled have long sought alternatives. New Mexico’s been working to transition elderly people and disabled people into their own apartments, group homes or shared living situations with family members.

Home-based health care offers financial advantages for the state, too. "In the long run," says Matt Kennicott, spokesperson for the Human Services Department, "the cost will be driven down because we’re paying for less expensive services.”

So why was a plan to help increase the number of people moving into independent living situations axed by the state without warning? Advocates say they never had a chance to offer input on the decision, and they’re dismayed by the lack of transparency.

New Mexico’s program for phasing people out of nursing homes is funded in large part by the federal government, which covers 70 percent of the cost. In February 2011, the feds awarded a supplemental grant called Money Follows the Person. The only hitch was New Mexico would have to start meeting federal guidelines.

Regulation-wise, there’s one crucial point of contention: New Mexico tries to circulate nursing home residents back into the community within a month, while the feds say careful planning requires at least 90 days.

A Rumor Confirmed

That extra cash is vital, says Ellen Pinnes, a Santa Fe-based public policy analyst. "The idea that the state would unilaterally decide to withdraw and not even tell anybody … is very disturbing.”

State officials would not supply the Alibi with the numbers they used to make the call. They say saving money was their motivation. But with the grant, New Mexico would have ultimately been responsible for only 15 percent of program costs—half of the 30 percent it usually pays.

The decision to forego the federal funding first reached advocates as a rumor. A few weeks ago, policy analyst Pinnes started hearing whispers among her colleagues. A May 31 letter from the Human Services Department had withdrawn the department’s application for the supplemental Money Follows the Person funding.

When the grant was awarded in early 2011, the feds said it would amount to more than $23 million over the course of five years. It looked like a sure thing: As late as mid-April of this year, Human Services was publishing rule changes to align with grant requirements.

But it all came down to accounting: “After careful consideration and extensive cost analysis,” reads the letter, “the state has determined that it will achieve greater gains by focusing administrative resources toward the management of [other] projects rather than MFP.”

Plus, says Human Services spokesperson Kennicott, New Mexico is already ranked first in the nation for moving people out of nursing homes.

On Friday, June 15, Julie Weinberg, director of the state’s Medical Assistance Division, sent an email to advocates and other stakeholders who’d been working on Money Follows the Person. She explained that her department had found 90-day nursing home stay requirements would cost the state more than the extra money the feds offered to pitch in. She wrote that the $23 million the working group had been expecting was a grant in name only. "We will have to provide the services and spend the money to get the federal match."

The Overhaul

Federal and state governments are struggling mightily with growing Medicaid burdens. Countrywide, politicians are trying to figure out how to cope with the problem of quickly rising prices and dwindling cash in state coffers. More than a quarter of people in New Mexico get health care through Medicaid, and it eats up about 16 percent of the state’s total budget, according to the Human Services Department.

The department’s mission statement has changed. It used to read that Human Services aimed "to ensure low-income and disabled individuals in New Mexico equal participation in the life of their communities." At the start of Gov. Susana Martinez’ term, that language was modified to indicate the department provides "support services that help families break the cycle of dependency on public assistance."

The state has been working on a massive Medicaid overhaul, but it’s garnered criticism for a lack of stakeholder input and transparency. The controversial revision was cited in the May 31 letter as one of the state’s reasons for turning down the Money Follows the Person dollars.

Kennicott asserts that the big changes won’t harm the existing transitions program. “There will be more and better services than people are receiving now,” he says. The revamp should also make a dent in the long list of people waiting to leave nursing homes, he adds.

Overhauling Medicaid will also grant greater flexibility for long-term care recipients, he says. “We’re going to give people an à la carte menu of services to pick from once they’re back into their home.”

Too Busy

James Jackson, executive director of Disability Rights New Mexico, says his organization understands the state’s long-term approach to cutting costs. But, he asks, why are 42 other states with long-term budget concerns choosing to use the federal grant—and abide by the rules that come with it?

He adds that advocates are angered by the Human Services Department’s lack of clarity and consistency on the issue. The grant was awarded last year, but New Mexico dragged its feet implementing the rules and using the cash. The state called a meeting of stakeholders almost a year later, says Jackson, and assured the Medicaid Advisory Committee that everything was finally moving forward.

"Now they say that they’re so preoccupied with their Medicaid redesign … that they’re too busy for Money Follows the Person,” he says. “To just drop this bombshell without notice—it’s frustrating."

Policy analyst Pinnes says she’s seen no evidence yet from the state about why New Mexico can’t do it both ways. Many nursing home transitions take longer than 90 days to prepare for anyway. Those longer transitions could be easily tracked, she adds, and funded by Money Follows the Person. “If you have more programs, you’re more likely to find ways to help people move according to what their circumstances are.”