Maryland officials expect to save about $4.5 million in the Medicaid program over the next three years by expanding a state effort that subsidizes the elderly who live in grouse money from Medicaid -- the government insurance program for the poor and disabled -- to expand a Maryland program that now serves about 250 low-income, frail elderly people who require assistance with their daily living.
"You have elderly people who, if not for those support services, would be in a nursing home," said state health Secretary Nelson J. Sabatini, who is scheduled to join Gov. William Donald Schaefer today at a group home in Anne Arundel County to unveil the plan.
Staying in a nursing home costs about $30,000 to $35,000 a year, while staying in a group home costs less than half that. Although Medicaid money has long been used to finance nursing home care, it couldn't be used for group homes until now.
The expected savings from the new effort to allow more state residents to choose group homes will be shared by the state and federal governments, which together pay for Medicaid.
"We'll save money, not to mention [improving] quality of life," said Mr. Sabatini, noting that many seniors prefer the smaller, residential setting of a group home.
Maryland has 150 group homes for the elderly, ranging in size from four to 15 residents. Together they house more than 1,000 senior citizens.
The state currently is spending $1.6 million a year to subsidize the care of 250 of those residents, all with low incomes.
An estimated 17,500 nursing home residents have some portion of their bills picked up by Medicaid.
With the addition of federal funds through Medicaid, the state will be able to serve more people who want to enter group homes -- and to provide additional services to group home residents who, without more help, might have to move to nursing homes.
For instance, the program will fund some new services, such as social workers, and provide money for construction of wheelchair ramps in some group homes.
State officials say the Medicaid money will support an estimated 175 elderly Marylanders in the first year, while the existing state program will continue.
The new money is available for state residents who are at least 62 years old, with annual incomes of less than $10,416 and assets of less than $2,500. The candidate also must be certified by the state health department as someone who otherwise would need to move to a nursing home.
Maryland will become the second state to use Medicaid funds to subsidize the elderly in group homes. Minnesota started a similar program this year.
Texas is scheduled to begin one in September.
The Medicaid program in Maryland will cost the state and federal governments about $2 billion next year.
The so-called "waiver" in Medicaid rules is the result of the latest attempt by state officials to curb the program's skyrocketing costs.
During the first three months of this year, Maryland saved $1 million with a new program that tracks drug prescriptions for Medicaid recipients through pharmacy-based computers.