Moving Out of the Nursing Home

Federal support exists

The Money Follows the Person program, funded by the Deficit Reduction Act of 2005 and 2010's health care reform law, aims to move qualified Medicaid recipients out of nursing homes and back into the community. As of June 2010, 8,500 people have been able to move out of nursing homes, according to an assessment by Mathematica Policy Research. Approximately one-third of those people were over age 65.

Finances play a huge part in why people remain in nursing homes, says Senior Researcher Carol Irvin, who wrote the Mathematica report. Medicaid spends a lot more money on paying for nursing homes than for home- or community-based programs, which the program is not required to cover. If publicly funded, services such as home health aides are usually paid through state-specific waiver programs.

"Many believe it would be more effective, even more cost-effective, for Medicaid programs to serve more people in the community rather than in nursing homes and other types of institutions," says Irvin.

Money Follows the Person aims to figure out whether there is a cost savings, but the data hasn't been compiled yet. In California, Gaughan says programs like St. Paul's PACE, funded by Medi-Cal and Medicare, have been shown to save money over the long term.

Aside from the question of cost savings, Irvin will also be assessing whether people are happier when they live on their own compared with living in long-term care. Those results haven't been determined yet. Anecdotally, experts in the field and older people say this is a no-brainer: People are happier when they are living on their terms.

"Like when a bird gets locked up it can't fly — that's how it was for me," Smallwood says. "So when I got a chance to get here, I felt free. I've been happy ever since."

Cynthia Ramnarace writes about health and families. She lives in New York.