Aging in place versus nursing home care: comparison of costs to Medicare and Medicaid

Abstract

The objective of this study was to compare the community-based, long-term care program called Aging in Place (AIP) and nursing home care, in terms of cost to the Medicare and Medicaid programs. A retrospective cohort design was used in this study of 39 nursing home residents in the Midwest who were matched with 39 AIP participants. The AIP program consisted of a combination of Medicare home health, Medicaid home and community-based services (HCBS), and intensive nurse care coordination. Controlling for high inpatient Medicare cost in the 6 months prior and the 10 most frequently occurring chronic conditions, multiple regression was used to estimate the relationship of the AIP program on Medicare and Medicaid costs. Total Medicare and Medicaid costs were $1,591.61 lower per month in the AIP group (p < 0.01) when compared with the nursing home group over a 12-month period. The findings suggest that the provision of nurse-coordinated HCBS and Medicare home health services has potential to provide savings in the total cost of health care to the Medicaid program while not increasing the cost of the Medicare program.