States should make certain that Medicaid payments to assisted living community operators are high enough to encourage them to serve Medicaid beneficiaries and to increase beneficiaries’ access to home- and community-based services, according to the authors of a newly published study.

“States need to ensure their Medicaid rates for residential care services are sufficient to maintain an adequate supply of these settings and beds available to Medicaid beneficiaries while also safeguarding quality of care and taxpayer resources,” said Michael Lepore, Ph.D., a senior health policy and health services researcher at RTI International and the lead author of the study, which was published in the Journal of Housing for the Elderly.

“Higher Medicaid rates may encourage more residential care settings to serve Medicaid beneficiaries, which may help reduce nursing home use by older adults and people with disabilities and potentially reduce Medicaid spending on long-term services and supports,” he added.

In addition to low reimbursement from the government, assisted living operators’ decisions about whether to serve Medicaid beneficiaries also are affected by policies that limit the supply of Medicaid-certified assisted living settings and beds as well as policies that make beneficiaries responsible for paying for room and board, which can be difficult for people with low incomes, the researchers said.

The authors examined Medicaid policies in all 50 states and the District of Columbia, interviewed subject-matter experts and conducted four state case studies after reviewing state policies and stakeholder interviews.

The study also found that the quality of care in some assisted living communities may be negatively affected by operators’ decisions to limit the number of residents on Medicaid served or to decrease operating expenses.

More than 700,000 older or disabled Americans are served or cared for in assisted living communities and similar settings, according to the researchers, and the need will grow as the population ages.