Elderly/Long-Term Care

Medicaid nursing home reimbursement affects nursing homes' approach to end-of-life care

About 70 percent of all U.S. nursing home days are paid for by Medicaid. Medicaid reimbursement policy and rates have been found to affect nursing home hospitalizations and resident outcomes. Now a new study shows that increases in a State's average nursing home per diem payment significantly affects nursing home use of Medicare hospice. However, this effect is in opposing directions in urban versus rural nursing homes nonadjacent to urban areas, according to Susan Miller, Ph.D., and a team of researchers from the Warren Alpert Medical School of Brown University.

In urban settings, a $10 increase in a State's average Medicaid payment resulted in a half percent increase in nursing home hospice use. However, in rural nonadjacent areas a $10 increase resulted in a half percent decrease in hospice use. Revenue constraints for both nursing homes and hospices in rural nonadjacent settings most likely combine to explain this markedly different effect. In contrast, with a State's introduction of Medicaid case-mix reimbursement, both urban and rural adjacent and nonadjacent nursing homes increased hospice use by 2 percent. This study was supported in part by the Agency for Healthcare Research and Quality (HS16918).

See "The effect of Medicaid nursing home reimbursement policy on Medicare hospice use in nursing homes," by Susan C. Miller, Ph.D., Pedro Gozalo, Ph.D., Julie C. Lima, Ph.D., and Vincent Mor, Ph.D., in the September 2011 Medical Care 49(9), pp. 797-802.

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