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F I S C A L I M P A C T R E P O R T

SPONSOR Feldman

ORIGINAL DATE

LAST UPDATED

02/16/07

HB

SHORT TITLE All-Inclusive Elderly Care Enrollment Growth

SB 997

ANALYST Weber

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

$500.0

Recurring

General

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates HB 1075 Relates to Appropriation in the General Appropriation Act

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

FY09

$1,240.0

Recurring

Federal

Medicaid

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Human Services Department (HSD)

Aging and Long Term Services Department

SUMMARY

Synopsis of Bill

Senate Bill 997 appropriates $500 thousand from the general fund to the Human Services

Department for the purpose of expanding enrollment in the all inclusive care for the elderly

program in Albuquerque.

Senate Bill 997 – Page

2

FISCAL IMPLICATIONS

The appropriation of $500 thousand contained in this bill is a recurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of Fiscal Year 2008 shall

revert to the general fund.

SIGNIFICANT ISSUES

ALTSD reports that the Program of All-inclusive Care for the Elderly (PACE) in New Mexico

has one approved provider, Total Community Care (TCC). The PACE model was developed to

address the needs of long-term care clients, providers and payers. The program features a

comprehensive service delivery system and integrated Medicare and Medicaid financing. The

PACE provider receives monthly Medicare and Medicaid capitation payments for each eligible

enrollee. The PACE provider assumes full financial risk for participants' care without limits on

amount, duration or scope of services.

The PACE program currently provides services to 309 participants. The Program is limited in its

ability to grow to three (3) new enrollees per month as long as one (1) of the three (3) is a

nursing home reintegration client. TCC has successfully re-introduced 23 nursing home

residents into the community over a 25 month period. The monthly cost for a Medicaid eligible

individual to be placed in a nursing home is $4,098. If it becomes necessary for an individual

who participates in the PACE program to be institutionalized, regardless of the length of stay, the

PACE program assumes financial responsibility for the individual's placement and continues to

receive the monthly Medicaid capitation rate of $2,442.08. Due to Medicaid cost containment

strategies, a waiting list is now maintained by TCC for those waiting to receive services from the

PACE program. Twenty (20) individuals who were on this waiting list were institutionalized

due to non receipt of medically necessary long term care services. The monthly institutional

Medicaid cost for these 20 individuals is $81,960 ($4,098 monthly nursing home cost for 20

individuals), compared to the monthly PACE cost of $48,840 ($2,442.08 monthly PACE

capitated rate for 20 individuals).

This appropriation allows the PACE program to increase the growth of the program from three

(3) to six (6) enrollees per month. Enabling the enrollment to increase from three (3) to six (6)

per month, allows the total enrollment to reach nearly 400 enrollees. A census of 400 is

sufficient to expand to a second site. This would also allow the PACE program to reduce the

current wait list of 140 applicants.

Total Community Care (TCC) is experiencing census growth in the Northwest Albuquerque

area, the city of Rio Rancho, Bernalillo and Placitas. Currently, PACE has 82 existing enrollees

residing in this area and approximately 44 individuals residing in these geographic locations are

on the waiting list for PACE services. These geographic locations create difficulty in providing

efficient transportation services due to the distance from the current site and the limited access

across the Rio Grande River for those locations west of the river. The City of Rio Rancho is the

fastest growing city in New Mexico. Rio Rancho Economic Development has projected the

population in the year 2010 to be 81,793 residents. The new PACE site could potentially serve

an additional 200+ participants. The new site would also be a more efficient and effective way

to serve the participants who are currently residing in the Rio Rancho area who are being

transported to the current site for services.

MW/mt