UNDERSTANDING THE STATE VARIATION IN MEDICARE HOME HEALTH-CARE - THE IMPACT OF MEDICAID PROGRAM CHARACTERISTICS, STATE POLICY, AND PROVIDERATTRIBUTES

OBJECTIVES. During the past 7 years there has been a significant incre ase in the use of the Medicare home health benefit. In this article, t he authors document trends in the use of the benefit and develop multi variate models to identify the factors that explain state variation in its use. METHODS. To develop quantitative models, the authors collect ed state information on all variables for each of 3 years: 1991, 1992, and 1993. The authors chose to focus on those variables that had been found to be significant in other research as well as those that we po sited would likely influence utilization. The authors tested similar s ets of explanatory variables for each year of the analysis. The unit o f analysis is the ''state'' and depending on data availability, the nu mber of states included in the analyses range from between 46 to 49. ( Arizona does not have a state Medicaid program.) RESULTS. The authors' analysis shows that interaction exists between state policies and use of the benefit. Utilization is higher in states that face greater fis cal pressure concerning their Medicaid budgets; the lack of state pers onal care programs increases Medicare use, and, when Medicaid home hea lth expenditures decline, the number of Medicare home health care user s increases. There is also an inverse relationship between the number of long-term care and skilled nursing facilities in a state and the us e of the benefit. Thus, for some, the benefit serves as a substitute f or long-term care needs and, for others, for postacute care needs. CON CLUSIONS. The overlap between the population served and the services p rovided by state programs and Medicare has given states and providers an opportunity to leverage Federal dollars in lieu of state program do llars. As the Federal government attempts to control expenditure growt h, policy-makers must be mindful of how state actions fan influence th e level and type of Federal expenditures.