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  1. TITLE:Delivering on the Promise: Department of Health and Human Services Self-Evaluation to Promote Community Living for People with Disabilities-Chapters 1 and 2

  2. AUTHOR: Specific author unknown (KACW 4/1/03)

  3. INTRODUCTION: The Department of Health and Human Services (HHS) provides funds for and manages programs that serve people with disabilities of all ages. In FY 2000, total HHS expenditures for people with disabilities were $73.5 billion. The largest of these expenditures was for Medicaid ($43 billion). Medicare spending totaled approximately $28 billion. The President issued Executive Order 13217 calling for a swift implementation of Olmstead by identifying barriers that impede community living and recommending solutions. (See the next paper for specific barriers and proposals to eliminate them.) Other HHS programs, such as Head Start, serve people with disabilities along with the general population but are not focused exclusively or primarily on community integration.

    4. This report is based upon an agency self-assessment, review and analysis of comments from more than 800 individuals and organizations representing diverse interests and disabilities. The process led HHS to identify critical barriers to community-based alternatives and commit to take action to reduce and eliminate those barriers. The five major types of barriers to community living for people with disabilities are:

    • Imbalance in system structure and finance;
    • Lack of responsiveness of services to meet individual needs;
    • Need for greater assistance to families and informal caregivers;
    • Fragmentation and lack of coordination and
    • Need for increased accountability and legal compliance

    To address these barriers, HHS has developed a comprehensive policy framework featuring seven basic types of action:

    • Enhancing infrastructure within the Department to promote community living through the establishment of the Office on Disability and Community Integration and other management initiatives;
    • Collaborating within HHS and among federal agencies that provide critical supports and services to people with disabilities;
    • Proposing system reforms to reduce institutional bias by eliminating administrative inefficiencies, reducing fragmentation and increasing services;
    • Ensuring on-going input of key stakeholders in system reform efforts through the Medicaid Reform Task Force and other workgroups;
    • Testing new models of community-based services delivery through demonstrations to improve supports to family caregivers, and improve access to community-based treatment for adults and children with mental illness;
    • Collaborating with the Department of Justice to enhance alternative dispute resolution options available to individuals who file ADA complaints with HHS that allege non-compliance with Olmstead and;
    • Developing better technical assistance to states to promote community-based care and compliance with Olmstead.

  4. THE NEED FOR COMMUNITY-BASED ALTERNATIVES:There are approximately 54 million individuals with disabilities in the US. At least 1.8 million of these individuals are living in institutions, including 1.6 million in nursing facilities, 106,000 in institutions for people with mental retardation and developmental disabilities, and 57,000 individuals in state and local facilities for individuals with mental illness. Approximately 52 million individuals with disabilities reside in the community, but an additional 2 million individuals are at risk of entering institutions. Medicaid historically has financed care delivered in nursing homes, facilities for individuals with mental retardation and developmental disabilities and other institutional settings. In fiscal year 2000, Medicaid spent approximately $49.5 billion dollars in these facilities. Over the past several years, however, the proportion of Medicaid spending directed to home and community-based care has increased. In fiscal year 1990, federal and state Medicaid spending for home and community-based care comprised approximately 13.7 percent ($3.9 billion out of a total $29.5 billion spent in both institutions and community settings) of long-term care spending. By fiscal year 2000, federal and state Medicaid spending comprised approximately 27 percent ($18 billion out of a total $68 billion spent in both institutions and community settings) of monies expended on long-term care. Moreover, it is expected that demand for home and community-based services will increase since individuals generally prefer these services to institutional care and since they are, on a per capita basis, generally less expensive than institutional care. Unfortunately, the historical Medicaid bias towards institutional care created an imbalance in the options available to individuals to the point where institutional placement often became the primary rather than last resort. States and the federal government have recently made progress in "re-balancing" the system. Home and community-based services as a percentage of all Medicaid long-term care spending have increased from 13.7 percent of the total in 1990 to 27 percent in 2000. Currently 31 states have opted to provide personal care services under their Medicaid program and all states provide home health services.

    Under grants to states made under the Ticket to Work and Work Incentives Improvement Act of 1999, 18 states intend to modify their personal assistance services program to more fully support the employment and community participation of individuals with disabilities.

    Currently, 260 Medicaid home and community-based waivers have been approved serving more than 615,000 individuals with significant disabilities. In fiscal year 2000, states and the federal government spent $12.3 billion on Medicaid home and community-based waivers. Since February 2001, 19 new waivers have been approved and 24 waiver amendments have been approved that will increase the availability of these services to individuals with disabilities.

    Finally in September 2001, CMS awarded Real Choice System Change grants, a $64 million package of competitive grants to states and other organizations to help design and implement improved methods of providing supports and services to enable the full community integration of individuals who have a disability or long-term illness. CMS has also revised its Medicare payment system for home health services in order to encourage home visits and services that are more responsive to the needs of Medicare-eligible individuals. CMS has also worked with states to approve innovative Medicaid waivers that promote community integration. These include "self-directed services" waivers that enable individuals or families to provide more direction over the services including comprehensive system reforms that promote person-centered planning together with flexible, integrated long-term support services that are free to follow each individual to the most appropriate and preferred setting.

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