Article: Capitated Payment Approaches for Medicaid-Financed Long-Term Care Services.

INTRODUCTION

Long-term care accounts for a sizable part of the Medicaid budget, almost $54 billion in 1995. Three-fourths of Medicaid expenditures for the elderly were for LTC (about $31 billion); 85 percent of these expenditures were for institutional care, and 10 percent were for home care services (Wiener and Stevenson, 1997).

The locus of LTC has been shifting from institutions to care based in the home and community. One reason is that beneficiaries often desire to remain in their homes and would prefer to receive LTC in non-institutional settings. Another reason is the potential cost-effectiveness of home and community-based care, although there ...

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