PODIUM | Help Home Health Providers with Inflation

Colorado Politics | By Don Knox

Home care agencies serving Medicaid patients are in a catch-22 with the current inflation rate and the higher cost of everything these days. On one hand, the critical services these agencies provide in Colorado communities have never been more needed. The most vulnerable among us are often hit the hardest when times get tough, and the invaluable services provided by home care workers help to keep Colorado’s Medicaid patients safe and healthy in their homes. On the other hand, the cost of providing these services has also never been higher, while the reimbursement for these services has not yet been adjusted by the Colorado Legislature to keep pace.

If home care agencies can’t cover the multitude of costs that go into delivering safe and effective Medicaid care under current reimbursement rates, how will they be able to continue serving patients? The reality is, they may not be able to. Agencies are quite literally being squeezed out of Medicaid — with the fate of patients and caregivers alike hanging in the balance.

The solution? The state needs to ensure reimbursement rates for Medicaid providers keep up with inflation and the rising costs of expenses that are inherent in delivering Medicaid services in the home — including the need for these agencies to provide competitive compensation for hard-working caregivers. These workers are also struggling with the high cost of living.

It isn't only the state’s Medicaid population that stands to lose. Taxpayers also have a lot at stake. Extensive research demonstrates the lower costs for at-home services provided through Colorado Medicaid programs such as Home and Community-Based Services waivers. According to the U.S. Department of Health and Human Services, average monthly spending for Medicaid clients under these waivers was $485 per month, compared with an average monthly spending per Medicaid-covered nursing home resident of $2.4K. That's a staggering difference. According to HHS, by investing in home and community-based services, Colorado is among the states that likely has avoided building nursing home beds that otherwise would have been built. If provider agencies are squeezed out of providing these cost-saving services, Colorado taxpayers will be the ones forced to foot the bill.

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[The Colorado Legislature reconvenes on Monday, Jan. 9, 2023. However, the Joint Budget Committee (JBC) has already begun meeting and deciding on budget priorities. That’s why HHAC is already hard at work for you at the capitol, educating policymakers about the need for increased reimbursement rates. You can view the material we provided to the JBC and other legislators here.]