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Straight Talk for Seniors®: Money Follows the Person

A 12-year-old program that has helped more than 75,000 seniors and individuals with disabilities move out of nursing homes is in jeopardy in Congress.

Enacted in 2005 with strong bipartisan support, Money Follows the Person (MFP) is one of the longest running and most successful Medicaid demonstrations. It helps states transition older adults and individuals with disabilities from nursing homes back to their homes and communities. It also allows states to make it easier for individuals to access home and community-based services (HCBS).

A total of 47 states have helped 75,000 individuals through the program. According to evaluations by Mathematica:

  • MFP participants report significant and lasting improvements in quality of life after returning to the community.
  • After individuals return to the community, their overall Medicare and Medicaid expenditures decrease by 23%.

MFP also has encouraged states to spend more money on HCBS instead of nursing homes. In FY05, states only spent 37% on HCBS, but the latest data show they’re spending over 53% today.

Extending and improving the program

Unfortunately, MFP expired in October 2016, and states are running out of funding. Most are now scaling back their programs and reducing dedicated staff and resources. Last year was the first time that the number of new people served declined.

NCOA has worked closely with Sens. Portman (R-OH) and Cantwell (D-WA) on new legislation (S. 2227) to extend the program for five years. The extension also would make minor improvements, including reducing the length of stay in an institution from 90 to 60 days, enhancing state accountability to ensure funds go toward home and community-based services, and improving sharing of best practices across states.

Extending the program will allow states to continue progress. Currently, HCBS accounts for 75% of spending in programs targeting people with developmental disabilities, but only 41% of spending for programs targeting older people, people with physical disabilities, and those with serious mental illness. In addition, over 50,000 nursing home residents say they want to talk with someone about leaving their facility, but they have not received a referral to a local agency that could help them, according to recent analyses.

Extending Money Follows the Person  is a common sense Medicaid reform. It improves the lives of older adults and people with disabilities while assisting states with moving away from funding nursing homes in favor of more cost-effective home and community-based services. We encourage you to ask your Senators to cosponsor S. 2227.

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Joe Caldwell

About Joe Caldwell, PhD

Joe Caldwell, PhD, is Director of Long-Term Services and Supports Policy at NCOA. He co-chairs the Disability and Aging Collaborative, a group of national aging and disability organizations working to advance long-term services and supports for older adults and individuals with disabilities.