Medicaid Cost-Savings of Home- and Community-Based Service Programs for Older Persons in Florida

Abstract

This study is designed to address the estimated Medicaid cost-savings of selected home- and community-based service (HCBS) programs in the State of Florida. Utilizing Medicaid claim data for SFY 2000-2005, a propensity score matching procedure is used to simulate random assignment of seniors into matched treatment (HCBS users) and comparison (waitlist) groups. We then produce an algorithm that determines the differences in Medicaid expenditures between the two groups, producing an estimate of cost-savings. Some HCBS programs in Florida show evidence of Medicaid cost-savings. Median Medicaid cost-savings varied widely, ranging from a cost overage of US$277 per member per month (PMPM) to a cost-savings of US$229 PMPM. Cost-savings appears most consistently when analyzing nursing home costs. The results of this study provide further evidence that nursing home cost-savings can be achieved through home- and community-based services programs.