Professional Documents
Culture Documents
Base year
$20,000 12% 13%
$15,000
Caps take
eect
$10,000
amount; otherwise, any excess comes entirely In Scenario 1, per-enrollee spending in any year
out of the state budget. is the lower of actual spending or the cap
amount. The impact of the cap is therefore
Methods assumed to be limited to the years in which the
For this analysis, we used publicly available data actual spending exceeded the cap.
for 20012013 on state per-enrollee spending on In Scenario 2, the states actual, year-to-year
Medicaid HCBS programs. Data on Arizona percent increase (or decrease) in per-enrollee
HCBS expenditures and participants come from spending is applied to the prior years spending,
reports produced by the Kaiser Family unless that change would have caused the per-
Foundation and the University of California San enrollee spending to exceed the cap. In that case,
Francisco.1 Unlike in most other states, Arizona per-enrollee spending is set to the cap level, and
data are not differentiated by program or the following years percent increase (or
population type. decrease) is applied to that amount. Thus, the
We developed two scenarios of the impact that impact of the cap extends to future years,
hypothetical BCRA-like reimbursement caps because increases that were limited by the cap
might have had on Medicaid spending, under the are not made up by additional increases in
assumption that states would not exceed their subsequent years.
per-enrollee cap. In both scenarios, we treated
2001 as the baseline year (equivalent to 2016 in Results
the BCRA), and 2005 as the year that caps Arizona HCBS spending exceeded the
would have been implemented (equivalent to hypothetical cap by a substantial amount. An
2020). Following the procedure proposed in the immediate 12 percent reduction in expenditures
BCRA, caps were inflation-adjusted using the would have been necessary (or the state would
CPI-MC of the data years (i.e., we applied CPI- have had to make up the difference) in the first
MC to the base-year spending for 2002-04, CPI- year of the caps, widening to 13 percent by Year
MC plus 1 percentage point for 200509, and 3.
CPI all items to 201013).
2
The blue line in Figure 1 shows Arizona per- The consequences would have been readily
enrollee HCBS spending. Although spending apparent: Without their long-term services and
under both capped scenarios drops as soon as supports needs met, more people would have
caps take effect, it gradually rises to meet actual been institutionalized, and those remaining in
spending in Scenario 1 (green line). In Scenario their homes would have been more isolated,
2 (red line), spending remains below actual experienced worse health, and prevented from
spending, ending at 13 percent less than actual. participating in their communities. The great
success of HCBS program expansion in enabling
Conclusions people to continue living at home and promoting
successful community integration would have
If per-enrollee caps like those proposed in the
been seriously jeopardized.
Better Care Reconciliation Act had been
imposed in the mid-2000s, they would likely
have caused Arizona, as well as many other
References
states, to restrict HCBS spending to amounts 1. Ng T, Harrington C, Musumeci M et al.
much lower than spending under existing Medicaid Home and Community-Based Service
Medicaid reimbursement rules. States like Programs: 2013 Data update. Issue Paper.
Arizona that invested in HCBS infrastructure, Washington, DC: Kaiser Commission on Medicaid
expanded benefits to serve people with higher and the Uninsured, 2016.
needs, or created new HCBS programs would
probably have become far less ambitious had
Funding
Federal match been capped. A capped The Community Living Policy Center is funded
reimbursement would have discouraged states, by the National Institute on Disability,
from innovating in delivering the types and Independent Living, and Rehabilitation Research
amounts of services that could meet peoples (grant H133B130034) and the Administration
needs. for Community Living, U.S. Department of
Health and Human Services. Opinions are those
of the author and not the funders.