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HMPRG Study Shows Negative Fiscal Impact of Home Care Cuts

The following was sent to members of the Illinois HomeCare & Hospice Council (IHHC), re: the study we were commissioned to do by the IHHC which showed the deleterious effects of cutting home care.

The Illinois Legislature will soon be deciding on how to slash the Medicaid program to satisfy the Governor's request of a $2.7 billion cut. The initial proposal from Governor Quinn was a 10% reduction in home care and hospice services through utilization controls. The Illinois HomeCare & Hospice Council has responded by commissioning a study by the Center for Long-Term Care Reform at Health & Medicine Policy Research Group (HMPRG) on the negative fiscal impact of home care cuts. We invite you to read the study.

As leaders in the home care industry, we have always claimed that the more money government leaders invest in home care, the less they will need to spend on health care.
The HMPRG report found several pieces of research to back our claims:
  • One national study found that home health services for patients with chronic illnesses who had been hospitalized lowered the costs and readmissions significantly.
  • Another national study showed that investments in hospice decreased Medicaid costs by lowering use of acute hospital care and medications.
  • An Oregon study found a ripple effect of state Medicaid cuts which triggered an equal loss of federal funds and resulted in a decline of jobs and economic activity.
In an effort to reach members of the Illinois General Assembly with this new study, we are taking a multi-pronged approach.

First, we have sent out a press release to the major news outlets in Illinois. The study is garnering attention as evidenced by this article in the State Journal Register  published at the end of last week (May 16, 2012) which is also being picked up to others in the chain.

The IHHC asked members to help push the news to their communities. We at HMPRG urge you to do the same. This is an important time for home care providers to make their case as the cost effective alternative in Illinois. Legislators are being forced to understand the different services under the Medicaid program like no other time. With their eyes temporarily wide open, we have the voices, and now the tool, to educate them on how we are the solution the Medicaid cost problem in Illinois.

An Article in the Illinois Statehouse News refers to the study (Download the article)

Study says cuts to home care lead to rising costs elsewhere

By Anthony Brino | Illinois Statehouse News

SPRINGFIELD — Illinois Gov. Pat Quinn wants to cut $11 million in Medicaid spending on home health care and, according to a new study, the move could lead to higher costs in nursing homes and hospitals.

The Chicago-based Health and Medicine Policy Research Group [1], a health-care policy nonprofit, found that other states that cut funding for home-based services, such as Hospice, saw costs rise for hospitalization and nursing homes.

The group scoured national studies and data on spending for Medicaid home services and spending on nursing homes and hospitalization for elderly patients. In Michigan, the group found, after home-care waivers were cut, spending on nursing homes and emergency hospitalization increased. “Home care stretches dollars,” said Lisa Hardcastle, president of the Illinois HomeCare and Hospice Council [2], an association of home-care providers, which commissioned the study. “It is a service that can help more people for less money.” The study comes amid the governor’s efforts to find $2.7 billion to plug shortfalls for Medicaid, a federal-state health care program for low-income residents, and a larger battle among lawmakers and interest groups over next year’s budget. It also highlights a looming challenge for the state health-care system — health care for the elderly. Within a decade the number of retired Illinoisans, now about 2.3 million, is expected to grow to 3 million, according to the study.