Privately-Run Managed Elder Care – Advocates Worry About Neglect

The elder care “problem” with which many policymakers in New York and federally are grappling is rooted around one issue: finances. In other words, there are many great models for providing high-quality care to seniors, but there is far less understanding of how to pay for that care. As a result, a balancing act is being performed within the New York Medicaid system as administrators determine what model provides the best care based on the amount of funds that the public can provide.

Is Managed Care the Answer?
The most popular recent trend nationwide, including in New York, involves using “managed care” programs for elder care. The idea is relatively simple: pay private companies to provide senior care at a set-price, with the compensation not tied explicitly to the exact services rendered. The pay-for-service model is often plagued with fraud and perverse incentives.

Alternatively, managed care often allows for more flexibility, with seniors able to receive at-home care for longer. Managed care can therefore be a “win-win,” with residents receiving the care they want while the Medicaid system saves money. According to a recent NY Times story, New York is second only to Texas in the total number of residents using long-term care programs managed by Medicaid.

But, as the use of private managed care programs increases, advocates are looking closer at the effects and finding some problems. Most notably, some worry that the system is harming those with the most severe ailments–increasing qualification requirements for nursing home stays and leaving many seniors without any support at all.

Managed care programs throughout the country are facing financial problems with several private companies going bankrupt, unable to provide necessary support while staying in the black. Those companies that have survived are often cutting benefits to enrollees, reducing compensation for their own caregivers, and otherwise lowering the quality of services provided. A New York Times story this week detailed many of the problems with these programs that have emerged over the last few years.

Some elder care advocates point out that this profit tension is an inherent part of elder care systems reliant on private companies. While managed-care options can be useful, they may not be the single “magic bullet” that solves the inherent challenges of providing proper elder care to all community members.

Plan Ahead
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