RALEIGH -- In the midst of a fiscal crisis, North Carolina has overshot its budget for in-home help to poor and disabled people by as much as $10 million a month, even though as many as 40 percent of recipients may not qualify.
The state-run Medicaid program known as personal care services has spent the $185 million budgeted to last until June, and more. Medicaid officials told a legislative study commission Thursday that the program continues to pay companies to provide generous hours of service to many among its nearly 40,000 clients, regardless of their level of need.
Legislators have asked that outside evaluators assess the clients' level of need - a change that's supposed to start next month - but under the current system, companies with a financial stake in providing clients with more care play a major role in deciding on their hours of service, state records show.
Last year, legislators armed with reports that many recipients didn't really qualify for the help, cut the state Medicaid budget for these services by $100 million dollars over two years - part of efforts to cut more than $1 billion from Medicaid, one of the state's largest financial burdens.
"As a policymaker, this is incredibly frustrating and disturbing," said state Rep. Jennifer Weiss, a Cary Democrat and study commission member. "An explosion of misauthorization and misuse has got to stop. But at the same time, when we are turning off the tap, we need to make sure that people that need care get it."
Tim Rogers, chief executive officer of the Association for Home & Hospice Care of North Carolina, a trade organization that represents the private companies that provide the care, called the information presented by the state "gross misrepresentation."
The group is fighting changes to personal care services with a petition to the state's Office of Administrative Hearings, charging among other grounds that the state has used faulty data and not followed the legislature's direction in setting up new means of checking a client's eligibility.
"A patient should get care they are medically qualified for," Rogers said. "We've never said that all people should qualify for the services."
A familiar problem
The findings outlined Thursday in the legislature's Study Commission on Aging are similar to those that plagued the attempted reform of the state's mental health system. In 2008, an investigation by The News & Observer found that the state had wasted hundreds of millions of dollars on a community support system for the mentally ill that relied on private companies. The aid came at much greater expense than that of personal care services, which costs Medicaid about $14 an hour.
Officials of the Division of Medical Assistance, which oversees Medicaid, told the panel that personal care in this fiscal year has continued at high levels despite last year's budget changes.
"Within six months, we have spent 104 percent of our budget," Larry Nason, chief of Medicaid Facility and Community Care, told the commission.
Medicaid officials also said that a study of recipients that included home visits by the nonprofit Carolinas Center for Medical Excellence between 2007 and 2009, showed that roughly 40 percent didn't qualify even for the lowest level of care. Those who qualify require help with at least two essential daily activities, such as eating or bathing.
"We have a large number of people that don't meet the minimum qualifying standards," Nason said.
A doctor has to approve the aid, but companies providing the services typically pass along to physicians the company's own assessments of clients' needs, officials said.
Nason noted that recipients often receive nearly the maximum of 60 hours a month of services regardless of their level of disability, with a statewide average of 53 hours, according to state figures released Thursday.
A growing program
North Carolina has ranked in the top four states in terms of dollars spent on in-home personal care services, which can help keep fragile people at home and out of more expensive residential care.
Nason, the Medicaid official, said the number of clients in the program has grown 146 percent in seven years, from 15,687 in 2002 to 38,569 in 2009. Legislation passed last year required the personal care services program to start using independent professionals, not staff at the companies that provide the services, to assess whether clients need the care. Those assessments will be performed by the Cary-based Center for Medical Excellence. They should begin in March, Medicaid officials said.
"If people qualify, they are not going to be discharged from the program," saidKaren Feasel, Medicaid policy analyst. "Nobody who does qualify is going to get kicked out."
The trade organization's lawsuit charges that many thousands of recipients would have to be moved to long-term care homes because of changes in the personal care services program. A judge has not ruled in the case.
Mary Bethel, a lobbyist for AARP, said personal care services are critical.
"A lot of people don't have that family support system," Bethel said at the legislature Thursday. "But I think you've got to insure that the system's in place to do the screening."
Personal care services are just one of a range of state programs that aid older people and those with disabilities, Bethel said.
"Now we are facing budget crunches and it's going to be hard to hold on to what we have," she said.
