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Models for Comprehensive Health Care Coverage for the Elderly

By Amal Trivedi, MD, MPH, Associate Professor, Department of Health Services, Policy and Practice and Department of Medicine, Brown University

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Patient Education

In the US, health care services for the elderly are funded mainly by Medicare, Medicaid, the Veterans Health Administration, private insurance, and out-of-pocket payments. In addition, many states offer health-related benefits and programs, such as subsidies for transportation, housing, utilities, telephone, and food expenses, as well as help at home and nutrition services. Health care workers should help elderly patients learn about health benefits and programs they are entitled to.

Individually, Medicare, Medicaid, Medigap, and private long-term care insurance have shortcomings in providing comprehensive geriatric care:

  • Medicare excludes long-term custodial care, some preventive services, and large amounts of prescription drug costs.

  • Medicaid belatedly intervenes after the patient is impoverished.

  • Medigap, like Medicare, excludes long-term care.

  • Private insurance is too expensive for most of the elderly, leaves them vulnerable to financial catastrophe, and supports only fragments of long-term care.

Collectively, these programs rarely promote integration of acute and long-term care or coordination of health and social services. However, several model projects have demonstrated that with organized delivery of services using combinations of public funding and private insurance, comprehensive geriatric care, including some long-term care, can be adequately financed.

Social health maintenance organizations (SHMOs)

SHMOs are demonstration programs financed by Medicare. They use Medicare, Medicaid, and private patient payments to cover a wide range of care benefits managed by nurses, social workers, and physicians. Patients not eligible for Medicaid benefits use private payments to cover a limited amount of long-term care, principally in the home. Like an HMO, an SHMO is at financial risk for the cost of services and therefore has an incentive to manage resources carefully.

Program of All-Inclusive Care for the Elderly (PACE)

PACE is designed to keep patients living in the community as long as medically, socially, and financially possible. A PACE interdisciplinary team assesses patient needs and develops and implements a care plan.

PACE includes medical and dental care, adult day care (including transportation to and from the facility), health and personal care at home, prescription drugs, social services, rehabilitation, meals, nutritional counseling, and hospital and long-term care when needed. PACE programs provide social and medical services primarily in an adult day health center, supplemented by in-home and referral services. The PACE service package must include all Medicare and Medicaid covered services, and other services determined necessary by the interdisciplinary team for the care of the PACE participant. PACE may require a monthly fee.

The following is needed to qualify for PACE:

  • 55 or older

  • Live in the service area of a PACE organization (in a state with approved PACE providers)

  • Need nursing home-level of care (as certified by each state)

  • Be able to live safely in the community with help from PACE

Extended care communities

A life-care community or continuing care retirement community provides housing, health care, and other services under packaged financing and management. These communities may have a clinic, an infirmary, or even a nursing home on the site, and housing is designed to accommodate disabled people. Many of these communities serve wealthy retirees willing to sign long-term contracts for their housing and care.

Some life-care communities fail because inflation and an aging population cause costs for services to exceed income. Some communities keep costs down by providing housing and minimal services with options to purchase additional services.

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