In Louisiana, Nursing Home Managed Care Fight Creates Different Battle Lines

In state after state, the movement to Medicaid managed care has created familiar battle lines: Government officials promise better coordination of care and budget savings. Providers and patient advocates, meanwhile, fear a loss of revenue and services, sucked away by paperwork and rules. Often, the providers and patients have been right, at least in the early going.

That’s what makes the current drama in Louisiana over bringing managed care to the state’s nursing home industry so interesting. This time, patient advocates, including the American Association of Retired Persons (AARP), are at odds with the leading providers, the Louisiana Nursing Home Association. Nursing homes seek to carve themselves out from the onward march of managed care into Medicaid, as one of the poorest states looks for savings during a budget year so bleak there is talk of cutting the operating budget at Louisiana State University by 82%.

Already, managed care has come to Medicaid in 2 phases in Louisiana to handle $8 billion worth of medical and behavioral health services. The takeover of $2.1 billion of services for 72,000 clients who are disabled by old age, developmental disabilities or adult-onset conditions such as diabetes would be the final piece. But reports in The Advocate, based in Baton Rouge, and industry publications this week state that the nursing home industry is trying to disrupt the state’s request-for-proposal process by taking its case directly to state legislators, in an attempt to keep its piece of the revenue pie.

Records show the state dollars for the disabled are largely spent on nursing homes, including 71% percent of the dollars spent on the elderly clients. This occurs even though a 2014 AARP survey found Louisiana residents overwhelming prefer spending tax dollars to keep their elderly relatives in home-based or community settings. An AARP spokesman has said a nursing home “carve out” from managed care would maintain the status quo, eliminating opportunities to transition elderly patients to home-based care when they are able.

Because such a large share of state funds are devoted to nursing home care, the waiting list of developmentally disabled and elderly seeking community-based services tops 30,000 people, according to a report in The Advocate.

Louisiana faces a $1.6 billion budget gap that has LSU drafting an “academic bankruptcy” plan, but the state has not considered Medicaid expansion for those earning up to 138% of the federal poverty line.