Key Issues in Post Acute Care

1. Key Issues in Post Acute Care Robert E. Burke, PhD Gordon A Friesen Professor of Healthcare Administration School of Public Health and health Services The George Washington University April 10, 2013

2. Disclaimer • Views Expressed Are Based on My Past Work Experience • These Views Are Not to Be Considered as Representative of the Wertlieb Institute, The George Washington University Nor Any Public, Private, Federal or State Agency.

3. Today’s Goal • Provide you with some background and facts and some stories so that you • Can interpret and add to the health policy discussion with respect to health services for the elderly, frail and disabled.

4. Objectives • To clarify some of the confusing issues and topics in Long Term care • What is post acute/long term care • Who pays for what • Artificial complacency • The impending age wave – real or imagined • Impact on all the labor force

5. Population Pyramid • Past (Ideal)

6. Population Pyramid • Currentish

7. Population Pyramid • Future

8. Definitions • Post acute care • Skilled Care • Rehabilitation Services • Home and Community Based Services • CCRC (Continuing Care Retirement Communities) • Assisted Living

9. Who pays for what • Private Pay • Medicaid • Medicare • Insurance – long term care, disability and workmen’s compensation

10. When does long term care start • At the end of a hospital stay? • When there is a need for supportive services • Is it all medical and health care • What are the social needs? • Role of friends and family

11. Indicators of Long term care need • Diagnosis • Functional Ability • Instrumental Activities of Daily Living (IADL) • Activities of daily living (ADL) • Late loss ADLs as trigger

12. Providers of Care • Friends and family (60%) • Paid • Clinical, home health aide, homemaker • What ties it together is ‘case manager’

13. Historical Information • Number of skilled nursing home facilities in 1977 was 16,000 • Number of skilled nursing home residents in 1977 was 1.5 million • Do the math and see that the average size of nursing homes was about 100 beds.

14. Historical Information • Nursing homes as we know them really are a post World War II phenomenon • County and religiously sponsored • State and locally operated until Medicare and Medicaid certification in 1966. • Social security Amendments of 1972 increased participation of proprietary nursing home

15. Historical Information • In 2013 how many nursing homes are there? • How many nursing home beds are there?

16. Historical Information • What happened? • Population – age of admission – depression? • Assisted living – not regulated by federal government….. • Growth of home and community based services.

17. What is Long Term Care? • Confusing Question - All Post Acute Care? • Skilled nursing home, intermediate care, custodial care • Independent and Assisted Living • Home and Community Based Services • Aging in place • VNA, Home Health Care Aide, Homemaker

18. Starting Points • Number of Certified SNF – 16,500 • Annual Turnover • Administrator – 40 to 50% • DON - same • CNA – up to and over 100% • Numbers seeking NHA Licensure decreased by one third since 1990 (MCCA) • Number of ALF is over 40,000 • Annual Turnover – unknown as not reported

19. How Big is Long Term Care • It is very big…………

20. Long Term Care Expenditures

21. What does the nursing home business look like? • It is most regulated health care business • Average 100 beds • Average 100 staff • 80% census – dropped from over 95% • At least 4 different payment systems, • Medicaid, Private, Insurance and Medicare • Annual Revenue of between $3 and $5 Million

22. Nursing Home Facilities and Beds, by Type of Ownership

23. How Much is Long Term Care • Skilled Facility - $60 to $120,000 per year • Assisted Living about $40 to $60,000 per year. It is an “a la carte plan.” • Assisted Living have an Admission fee which ranges up to $1 million with a proportion returnable to heirs • Home and Community – After Medicare, what the market will bear.

24. Who Pays for Long Term Care • We all do • Medicare Premiums • Medicare Payroll tax deductions • General tax revenues that support Medicaid • Different insurances • LTC • Workmen’s Comp • Personal health

25. Who Pays for Long Term Care • Private – including insurances 40 to 50% • Medicare – 10 to 20% • Medicaid - 40 to 50% • For some states, the largest item in the budget is Medicaid.

26. Skilled Long Term Care • Medicare Part A is for Acute Care but • SNF benefit is 100 days per spell of illness • First 20 days at full payment • Days 21 to 100 IF DETERMINED TO BE MEDICALLY NEEDY have a copay of $141 per day to total $11,280. • Average Medicare LOS • Ortho – less than 20 • CVA – about 30

27. Skilled Long Term Care • Medicare Part B is and Option for Physician and Other Professional Services. • Medicaid “Buy-In” for Medicare Part B • Medicare Part C aka Medicare Advantage is an HMO Option run by private insurance companies • Medicare Part D is the Pharmacy Option

28. Long Term Care Utilization • Data suggests that 20% of all over 65 will use a nursing home. • BUT only 5% will use it for greater than 90 days. • Long Stay Nursing Home Admissions are • Female • 84 • Who need nursing supervision

29. Who Regulates Long Term Care • Federal • Certification for Medicare and Medicaid • State • Licensure of facility, administrator and other key personnel • Ombudsman • Local • Fire and Sanitation

30. Remedies • Until OBRA 1987, there were not mid level sanctions. • It was all or nothing…… • Result very few closings….very little real regulatory punch • After OBRA 87 there is a plethora of sanctions.

31. Physicians in Long Term Care • Total number of MDs in US - approximately 750,000 estimate of AMA • Board Certified Geriatricians (?) • Physician Members of American Geriatric Society – 4,700 • Physician Members of American Medical Directors Association – 5,300

32. What Type of Long Term Care Do People Want • What is perfect for me

33. Brief History of education for nursing home administrators • 1950s – most common nursing home administrator license was “in situ.” • Had the job, got the license. • 1960s – GWU starts an correspondence course in nursing home administration. • 1966 – Medicare requirements more sophisticated management required, GWU courses are incorporated into the MHSA degree

34. Brief History of education for nursing home administrators • 1972 Social Security Amendments spell out the general requirements for licensure for the States to adopt. • 1980s GWU’s nursing home administrator program receives national reputation • 1998 The inception of the Wertlieb Institute • Today, GWU is only one of 5 nationally known Master’s Programs in the US • Duke, Hopkins, USC, and North Texas

35. News • Good • There will be a continued need for post acute care • Bad • Number of those seeking careers in geriatrics remains low and more disturbing, applications for nursing home administrator licenses has dropped • Indifferent • Boomers will not need nursing services until 2032….why worry

36. Impact of Health Reform • NOT CLEAR • ACOs • LTC will not go away • Services and some provider or provider types may change focus and locus

37. What types of Long Term Care is Available • Model is changing • Lack of funds • True or not • Lack of staff

38. Who Will Take care of ME? • How do we encourage careers in post acute care? • Attitude, it needs to be changed • Most dreaded words are Nursing Home • Values • A difficult one in our culture of immediate replacement – people are not cell phones or i-pods

39. Major Infrastructure Problems • Personnel Shortage • Regulatory Atmosphere • Reimbursement Strategies/ Liability Ins • Ownership • Inability to raise capital • Growth of other options • Assisted living • HCBS (home and community based services)

40. Solutions • Market Forces • Just increase the awards and rewards • FEAR……the usual American response • Increase regulations and requirements • A Plan • That focuses on recruitment and retention • Move out of our sacred silos to develop a program that the post acute care industry wants and meets and expands GWUMC capacity.

41. Growing Paradox • Proprietary owned facilities and corporations serve more Medicaid residents than the nonprofits. • What does that say?

42. Emerging Assisted Living Trends • Larger units • Increased amenities • Special Care • Wellness clinics • Residential character

43. Dementing Illness/Alzheimer’s • Approximately 4 million Americans • 5.5 million by 2010 & 14 million by 2050 • 4th leading cause of death in adults • 100,000 deaths each year • Need for special programs

44. Long Term Care Insurance • Should I purchase LTCI for • Self, Spouse, or Parents? • LTCI is asset protection, therefore, do I have assets protect? • Financial Planners suggest the asset threshold in 2005 dollars $600K

45. Long Term Care Insurance • Should I buy LTCI? • ANSWERS……. • DO THE MATH for your personal situation • Group policies tend to give more service options per premium • Ask what the sales representatives commission is…….you might be surprised at the answer.

46. What’s Next? • Be on the look out for your parents….those take-charge baby boomers. • The Tsunami is coming in the next decade. • Keep a sense of humor