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Health Care Costs and Financing

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Facility, patient, and community factors are associated with long-term care costs for people with mental retardation

People with mental retardation were housed primarily in large institutions in the 1960s, but they are now living predominantly in community residences. A new study may aid planning for the residential care of approximately 100,000 people with mental retardation who are on waiting lists for community residences. The study shows that severity of disability, facility characteristics, and community resources are associated with the long-term care costs for people with mental retardation.

The study was conducted by Jeffrey A. Rhoades, Ph.D., of the Agency for Healthcare Research and Quality, and Barbara M. Altman, Ph.D., of the National Center for Health Statistics. They analyzed data from the Institutional Population Component of the 1987 National Medical Expenditure Survey of health care use and expenditures by the U.S. population.

The mean daily expense was significantly greater for those with severe or profound mental retardation. Younger residents (less than 22 years) and those with greater needs for assistance (limited in two or more activities of daily living) had greater daily expenses. Daily expenses were higher for minority residents than white residents. The mean daily expense was also higher in larger facilities with 16 or more beds compared with those that had 3 to 15 beds. This was probably due to the higher level of disability and severity of retardation, requiring greater levels of care, among residents of larger facilities.

Nonprofit or government facilities, facilities with a higher number of services included in the basic charge, and facilities that routinely provide more additional services had higher daily expenditures. Finally, facilities located in the Northeast or Midwest had higher daily expenditures than other regions of the country. The level of community affluence (per capita income)—but not generosity of State programs—also influenced daily expenses for residents. After analyzing the interaction of these factors, the researchers conclude that moving people with borderline, mild, moderate, or severe mental retardation to smaller facilities could result in cost savings or at least no additional cost.

See "Personal characteristics and contextual factors associated with residential expenditures for individuals with mental retardation," by Drs. Rhoades and Altman, in the April 2001 Mental Retardation 39(2), pp. 114-129.

Reprints (AHRQ Publication No. 01-R070) are available from the AHRQ Publications Clearinghouse.

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