Medicaid
Capitated Payment of Medicaid Long-Term Care for Older Americans: An Analysis of Current Methods
Research Report
Richard Kronick, Ph.D., University of California, San Diego
Tony Dreyfus, MCP
March 2001
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As the number of individuals over age 85 increases as a percentage of the U.S. population, it is likely that there will be a significant rise in the demand for long-term care services. In an effort to restrain expenditure growth and improve services, state Medicaid programs have shown an increasing interest in developing new methods of LTC financing. One approach is to capitate long-term care whereby the provider is paid a fixed amount per person. Under a capitated system, states would have greater flexibility to provide long-term care in less costly home and community-based settings, while controlling LTC expenditures. In this AARP Public Policy Institute Issue Paper, Richard Kronick of the University of California San Diego and Tony Dreyfus discuss several important considerations that policymakers need to weigh when deciding whether or not to adopt a capitated approach for financing long-term care. (30 pages)
Pub ID: 2001-03