Long-Term Care Financing: Blueprints for Reform
Special Committee on Aging, United States Senate
American Association for Geriatric Psychiatry
6/20/2002
Statement for the Record Submitted by the American Association for Geriatric Psychiatry to the Special Committee on Aging, United States Senate, Hearing on Long-Term Care Financing: Blueprints for Reform
The American Association for Geriatric Psychiatry (AAGP) is pleased to have the opportunity to submit a statement for the record on long-term care financing and the reforms needed in the current patchwork of systems under which care is provided. AAGP is a professional membership organization dedicated to promoting the mental health and well-being of older people and improving the care of those with late-life mental disorders. AAGP’s membership consists of approximately 2,000 geriatric psychiatrists, as well as other health professionals who focus on the mental health problems faced by senior citizens.
AAGP recognizes the exceptional work that has been done by the Special Committee on Aging in recent months in holding hearings and developing a report on the full spectrum of long-term care issues facing our nation. In our statement today, we will address a number of financial barriers to care that are of particular concern to older Americans with psychiatric and mental health impairments.
It is important to note that numerous studies show that at least half of all nursing home residents have a dementing illness and the prevalence of depression in nursing homes is about 20 percent. As our society rightly focuses on finding ways to allow elderly Americans to remain at home or in community settings and to remove the current system’s bias towards institutional care, it is crucial that we acknowledge the nature of the illnesses that, more and more, are the impetus for institutionalization. Early diagnosis and interventions in mental disorders, as well as help and training for caregivers, are necessary if we are serious about changing the status quo. For those elderly persons who are in skilled nursing facilities, there are a number of important mental health issues that must be addressed if the frailest of our fellow citizens are to be able to live out their lives with dignity.
With respect to services provided by Medicare, there are two systemic issues that constitute major barriers to patients who require psychiatric services.
First of these is the issue of mental health parity. The lack of mental health parity in the private market has been much on the public agenda in recent years, as it should be. It is an issue for Medicare beneficiaries as well: Medicare imposes a 20 percent co-insurance rate on most outpatient services except for mental health services, which require a 50 percent co-insurance rate. That unfair bias in the system – a product of and continuing contributor to the stigma tragically associated with mental illness – is a major barrier to access to care. In addition, the distinction causes confusion and improper carrier reimbursement decisions, such as the continuing decisions by carriers to reimburse only 50 percent for medication management services in patients with Alzheimer’s disease and other dementias, contrary to specific instructions issued by the Centers for Medicare and Medicaid Services (CMS).
Second, even if patients have access to mental health practitioners, they must also be able to have access to the necessary treatment. Prescription drugs are essential components of treatment for a number of mental illnesses – and an outpatient prescription drug benefit, including full coverage of psychotropic medications, must remain high on the Congressional agenda.
Other changes to the Medicare system which would benefit geriatric patients with mental health needs would include broader coverage of case management and care plan oversight, now limited to patients who are receiving home care or hospice care; full coverage of Medicare/Medicaid cost-sharing for low-income patients; and revisions in reimbursement policies for services delivered in assisted living facilities
For patients in skilled nursing facilities, there are similar disincentives to appropriate care built into the reimbursement policies and systems. Most mental health services in nursing homes are funded by state and federal Medicare and Medicaid payments and are therefore subject to changes in reimbursement policies and restrictions. Efforts to control expenditures through caps on nursing home beds, restrictions on reimbursed services, and below-going-rate reimbursements for services provided restrict the ability of most nursing homes to increase levels of mental health services. Staffing requirements under Medicare do not address needs for assessment and psychiatric treatment of residents. Regulatory requirements focus on screening for mental illness, a system that itself is inadequate, but even with screening, necessary mental health services are all too often inadequate or unavailable.
Among the barriers that make it difficult to improve mental health services in nursing homes is the confusion in funding sources. The split between institutional payment for facility-based services (Medicare Part A, Medicaid, private insurance, self-payment) and individual payment for professional providers (Medicare Part B) creates an artificial distinction between needs of individual residents and those of facilities in assessing, understanding, and designing treatment for these needs. The consequent problems ultimately lead to inadequate mental health care – or no care at all.
Another important factor in the lives of our patients is that virtually all of the frail elderly are dealing with comorbidities that may include physical as well as mental ailments, circumstances that require careful collaboration among patients, families, caregivers, and practitioners from a variety of health care disciplines. Reimbursement for services under these conditions is cumbersome at best and is often a barrier to best practices.
In conclusion, AAGP would reiterate that access to appropriate mental health services is at the heart of providing the long term care to elderly Americans in the way that is most desired by patients, their families, and health care practitioners. The financial barriers imposed by an antiquated structure, complicated by antiquated notions of mental illness and treatment, must be reformed. AAGP appreciates the leadership exhibited by this committee, and we look forward to working with Senators in finding solutions to the problems that have been identified in the delivery of long term care in our nation.
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