Many states have responded to growing Medicaid long-term care expenditures by limiting the number of long-term care providers through certificate-of-need (CON) programs and moratoriums on new construction or certification for participation in the Medicaid program. This article focuses on the use of these policies in 13 states. Most of the 13 states control the supply of nursing home beds and hospital conversions with CONs or moratoriums, but they are struggling to adapt the role of supply policy to the growth of home health and residential care. As an increasing proportion of Medicaid long-term care spending goes to these nursing home alternatives, supply policy needs to keep pace with the changing provider market and the changing demographics of the consumer market if it hopes to ensure access to long-term care and control Medicaid expenditures.
During 1993 and 1994, the United States debated but did not enact major health care reform. Although the reform efforts focused on providing health coverage for the uninsured and controlling acute care costs, many proposals included substantial long‐term care initiatives. President Clinton proposed creating a large home‐care program for severely disabled people of all ages and all income groups, among several other initiatives. By stressing non‐means‐tested public programs, the president's plan was a major departure from the Medicaid‐dominated financing system for long‐term care. In designing the long‐term care component, the Clinton administration addressed many of the basic policy choices that must be decided in all reform efforts, including whether initiatives should be limited to older people or cover people of any age, how to balance institutional and noninstitutional care, whether to rely on government programs or on the private sector, and how to control costs. Analyzing the political and intellectual history of long‐term care during the health reform debate provides lessons for future reform.
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