Models for Comprehensive Coverage

Individually, Medicare, Medicaid, Medigap, and private long-term care insurance have shortcomings in providing comprehensive geriatric care. Medicare excludes long-term custodial care and many preventive services; Medicaid belatedly intervenes after the patient is impoverished; Medigap, like Medicare, excludes long-term care and outpatient prescribed drugs; and private insurance is too expensive for most of the elderly, leaves them vulnerable to financial catastrophe, and supports only fragments of long-term care. Collectively, these programs rarely promote integration of acute and long-term care or coordination of health and social services. However, several model projects have demonstrated that, with organized delivery of services using combinations of public funding and private insurance, comprehensive geriatric care, including some long-term care, can be adequately financed.

Social health maintenance organizations (SHMOs) are demonstration programs financed by Medicare. They use Medicare, Medicaid, and private patient payments to cover a wide range of care benefits managed by nurses, social workers, and physicians. Patients not eligible for Medicaid benefits use private payments to cover a limited amount of long-term care, principally in the home. Like an HMO, an SHMO is at financial risk for the cost of services and therefore has an incentive to manage resources carefully.

The Program of All-Inclusive Care for the Elderly (PACE) is designed to keep patients in the community as long as medically, socially, and financially possible. A professional interdisciplinary team assesses patient needs, develops a care plan, integrates primary care and other services, and arranges for implementation of services. PACE programs provide social and medical services primarily in an adult day health center, supplemented by in-home and referral services in accordance with participants' needs. The PACE service package must include all Medicare and Medicaid covered services, and other services determined necessary by the multidisciplinary team for the care of the PACE participant. As of 2004, 17 states have approved PACE providers and 2 states have submitted PACE applications pending approval from CMS.

A life-care community or continuing care retirement community provides housing, health care, and other services under packaged financing and management. These communities may have a clinic, an infirmary, or even a nursing home on the site, and housing is designed to accommodate disabled people. Many of these communities serve wealthy retirees willing to sign long-term contracts for their housing and care. Some life-care communities fail because inflation and an aging population cause costs for services to exceed income. Some communities keep costs down by providing housing and minimal services with options to purchase additional services.

This topic was last updated May 2005.