Home and Community-Based Services More Cost-Effective than Institutional Care, Says Nearly 40 State Studies

The AARP recently released a report stating that, based on 38 state studies published from 2005 to 2012, home and community-based services (HCBS) proved to be more cost-effective than institutional care. These studies supported the cost effectiveness of Medicaid balancing away from institutional care and towards HCBS.

The studies also consistently showed significantly less per-patient cost for HCBS. For example, in California in 2008, spending per patient averaged $32,406 in a nursing home and only $9,129 for HCBS. The studies also demonstrated cost reductions through diverting patients from institutional care to HCBS.

In Nevada, the monthly average number of older adults covered by HCBS waivers increased 58 percent from 2001 to 2007, while nursing home attendance decreased 8.5 percent during that time.

The AARP report demonstrates the quality and value of care that home and community-based care offers to beneficiaries. For a link to the full AARP report, as well as a one-page synopsis, click here.

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