New Medicaid Program Gives Recipients Cash, Not Predetermined Services

by Christina Medvescek on Mon, 2003-12-01 15:23

At least 10 states soon will be offering greater choice and control to people who receive Medicaid personal care assistance, through a program called Cash and Counseling.

The program provides cash instead of traditional agency services to eligible individuals. The cash can be spent on hiring a personal care attendant or in other ways that enhance the independence of the user. Participants are given counseling to help plan their purchases.

'Astronomical differences’

Cash and Counseling grew out of a test project in Arkansas, Florida and New Jersey. Approximately 6,700 elderly or disabled Medicaid enrollees received monthly cash allowances equivalent to the cost of their usual agency services. Within limits, participants could spend the money as they saw fit, including hiring family members and friends as caregivers, or buying assistive devices and making home modifications instead of getting services.

The program resulted in "astronomical differences" in consumer satisfaction, says Kevin J. Mahoney, project director and associate professor at the Boston College School of Social Work. Participants reported better quality of life, more support for family caregivers, fewer unmet needs, better caregiver performance and reliability, and no negative impact on patient health.

The program was evaluated by Mathematica Policy Research of Princeton, N.J., which has posted results at

Funding to expand Cash and Counseling to 10 more states comes from a grant from the Robert Wood Johnson Foundation, the U.S. Department of Health and Human Services (HHS), and the U.S. Administration on Aging.

Watch out

Some disability advocates fear that one hand will give while the other takes away.

Bob Williams, co-director of Advancing Independence: Modernizing Medicare and Medicaid (AIMMM), praised the "strength and beauty" of the Cash and Counseling approach, saying it uses "limited Medicaid dollars in ways that best ensure independence and basic well-being."

But he cautioned that the approach works best if two conditions are met: The individual already has a support network of family and friends to tap for personal care assistance; and the monthly allowances are adequate and can be adjusted if needs change.

"One of my greatest fears," he told the health subcommittee of the House Energy and Commerce Committee this summer, is that at least some states will take advantage of consumer choice as a way to cut Medicaid costs.

He urged the federal government to establish "basic safeguards" against this and encouraged people affected by disabilities to make their views on services known to their legislators.

Christina Medvescek
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